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Our strategy is simple - focus on the exploitation and exploration of oil and gas opportunities in the North Sea Continental Shelf.
We believe a unique opportunity exists to exploit a mature hydrocarbon basin with previously evaluated geological risks, accessible infrastructure, a stable and encouraging political environment and an attractive fiscal regime. We are focused on the North Sea for the following reasons:
- The UK sector of the North Sea contains an estimated maximum 16 Bboe of remaining discovered reserves and between 5 and 9 Bboe of estimated undiscovered recoverable resources
- Larger oil companies have shifted the focus of their capital deployment away from the North Sea, creating an opportunity for smaller companies to acquire and develop assets.
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The UK government has taken steps to:
o Encourage new exploration in areas which were previously the domain of larger players;
o Provide access to production facilities;
o Oblige existing acreage holders to commit to work programmes, farm-out or surrender their holdings; and
o Reduce takes on small and technically challenging discoveries.
- European and UK demand, declining North Sea gas supply combined with limited storage capacity, creates a favourable pricing environment for a North Sea gas producer
- The North Sea is a mature and technically well-understood basin, mitigating exploration risk
- The North Sea has a well-established infrastructure for oil and gas production, gathering and transportation, as well as ready markets.
Approximately 38.5 Bboe of crude oil, natural gas and NGLs have been produced in the UK to the end of 2008. Production in the North Sea has matured and the major oil producers view the remaining opportunities as too small for their attention.
We have observed that many of the larger oil and gas companies that previously dominated activity in the North Sea have been reducing their exploration efforts and we believe that many existing undeveloped discoveries may be economically developed and that substantial reserves remain to be discovered through exploration. UK Government policy is to encourage new investment into the North Sea in order to accelerate exploration and development of existing discoveries.
Ithaca's strategy is to:
- Acquire existing production and discoveries
- Use modern seismic, drilling and production technologies
- Use its technical knowledge to generate and acquire exploration prospects
- Participate in Licencing Rounds to gain acreage positions around its core assets
- Use the commercial skills of management to finance the exploitation of its exploration and development prospects through farm-outs, joint ventures and equity issues
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Focus on producing fields or undeveloped discoveries that:
o May be too small to be economic for larger companies
o May need investment, modernisation or rehabilitation; or
o May no longer fit with a company's strategy and business model
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To prioritize capital investment to those projects representing early production and cash flow.
These fields often have huge potential for additional discoveries. We plan to exploit them fully.
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