Press Release

Transformational Acquisition of Siccar Point Energy Reinforces Ithaca as one of the leading UK North Sea E&P Operators

7 April 2022

07 April

Transformational Acquisition of Siccar Point Energy Reinforces Ithaca as one of the leading UK North Sea E&P Operators

Ithaca Energy is pleased to announce that it has reached an agreement to acquire Siccar Point Energy.

Reinforces Ithaca as a Leading UK North Sea E&P Operator

The acquisition will accelerate Ithaca’s growth, positioning it as one of the leading E&P operators in the UK North Sea through the addition of four of the UK’s largest oil and gas fields to its portfolio. The consideration of the agreement includes an upfront payment of USD 1.1 billion and a series of contingent payments totalling a maximum of USD 360 million (USD 300 million linked to future developments and USD 60 million linked to short term realised commodity prices). The Siccar Point team and Operatorship of key UK assets will transfer to Ithaca on closing, further enhancing the Company’s established Operating capability.

Significant Growth Opportunities

The addition of the Schiehallion and Mariner fields, both currently in the top 10 UK producing fields, will not only add immediate production but also add significant room for growth through future drilling. Also included is an interest in the producing Jade gas field, where Ithaca is an existing partner, offering further near-term drilling exposure. The transaction will also include the Cambo and Rosebank fields, two of the largest undeveloped and most strategically important discoveries in the UK North Sea.

The acquisition of Siccar Point’s assets across the West of Shetland, Northern North Sea and Central North Sea, will add significant production, material growth potential, and a long-life cycle to the Company’s portfolio. The acquisition will also double Ithaca’s recoverable reserves and support production of at least 80,000 – 90,000 boe/d through the next decade, with the potential to increase this through further portfolio opportunities.

Reducing Emissions

The assets being acquired have a lower carbon intensity than both the UKCS and global averages. In particular, development of the fields will be undertaken using the latest technology to reduce emissions, and operated without the need for routine flaring or venting of hydrocarbons. This approach will mean that the new developments will have a carbon intensity of less than half of the average UK field.

This focus on emissions is in line with Ithaca’s current environmental programmes which aim to reduce CO2 output by 25% by 2025.

Supporting UK Energy Security and Creating Jobs

Cambo and Rosebank represent an opportunity for Ithaca to develop fields that will contribute significantly to the UK’s energy security. The Cambo field on its own is anticipated to deliver up to 170 million barrels of oil equivalent during its 25-year operational life, materially helping to reduce the need for the import of more carbon intensive alternatives and increasing the UK’s energy independence through the energy transition.

With a Final Investment Decision expected on both fields next year, they represent a near-term opportunity to enhance the local and wider UK economy through the creation of a significant number of employment opportunities directly and across the supply chain.

Alan Bruce, CEO of Ithaca Energy, commented:

“This is a transformational deal for the Company which cements Ithaca’s position as a leading independent E&P operator in the North Sea. The acquisition doubles our recoverable resources and means that we now have interests in a significant portion of the largest UKCS fields. This includes interests in two of the UK’s most strategically important and near-term developments which will enable us to play an increasing role in securing domestic energy supply for the UK. This enlarged portfolio will underpin production of 80-90kboe/d for the next decade, with the potential for further growth through low-risk drilling.

We firmly believe that this transaction will deliver value for all of our stakeholders including the local community and wider UK economy. The development of the Cambo and Rosebank fields is a huge opportunity to not only help secure the UK’s energy future for at least another quarter of a century, but also to create thousands of direct and indirect jobs in the process. We are excited about the future for the enlarged Ithaca, the role we will play in the UKs energy supply, and look forward to welcoming our new colleagues from Siccar Point.”

Gilad Myerson, Executive Chairman of Ithaca Energy, commented:

“Ithaca Energy has been on a rapid growth journey over the past three years – demonstrating our unwavering commitment to the North Sea. In that time, we have acquired producing and development assets from Chevron, Mitsui, Marubeni, Sumitomo (to be completed) and now Siccar Point. In addition, we have made significant investments to develop oil and gas prospects and resources around our infrastructure hubs – Captain (EORII), Alba (Fotla) and the Greater Stella Area (Vorlich, Abigail)."

“The Siccar Point team under the leadership of Jonathan Roger created an outstanding portfolio of assets with the dedicated backing of Blackstone and Bluewater. We are excited to become the stewards of these assets and continue developing them in a sustainable way to support our strategy, the UK economy, and the UKs Domestic Energy Security.”

Jonathan Roger, CEO of Siccar Point Energy, commented:

"We are proud of what Siccar Point Energy has achieved as a result of the dedication of our team and support of our sponsors, Blackstone and Bluewater, and combining our business with Ithaca Energy is a natural step to take the portfolio through the next stage of organic growth. Ithaca is extremely well placed, given its material production base, to pick up the baton and unlock the significant growth opportunities in the Siccar Point portfolio. This will ensure the UK continues to deliver reliable UK oil and gas production for powering homes and businesses and manufacturing essential products and maintaining energy security during the planned energy transition. We look forward to working with the Ithaca Energy team to support the integration of the businesses.”

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