BP PLC agreed to divest its interests in the Andrew area in the central U.K. North Sea and its nonoperating interests in the Royal Dutch Shell PLC-operated Shearwater field to Premier Oil PLC for $625 million.
The Andrew assets include the Andrew platform about 140 miles northeast of Aberdeen; the Andrew, Arundel, Cyrus, Farragon and Kinnoull fields; and associated subsea infrastructure, according to a Jan. 7 news release. Average daily production in the Andrew platform in 2019 amounted to about 25,000 to 30,000 barrels of oil equivalent per day. BP owns a 27.5% stake in the Shearwater field, which posted 2019 gross production of about 14,000 boe/d.
The off-loading of BP's interests is a part of the company's plan to focus its North Sea portfolio on core growth areas, which include the Clair, Quad 204 and ETAP hubs, BP North Sea Regional President Ariel Flores said. The transaction is the latest part of the company's planned $10 billion of divestments by the end of the year, according to the release.
In addition, Premier struck an agreement to increase its interest in the Tolmount area in the U.K. North Sea by 25% for $191 million plus contingent payments of up to $55 million, according to a separate, same-day news release. The Tolmount area is scheduled to deliver first gas by the end of the year.
Premier said it plans to fund the acquisitions through a $500 million equity raise, cash resources and, if needed, a $300 million acquisition bridge facility. The company will finalize the equity raise's terms during the first quarter.
Premier also proposed to extend its existing credit facilities to Nov. 30, 2023.
The deals are expected to close at the end of the third quarter, with an effective date of Jan. 1, 2019.