Shell along with partner Esso Exploration agreed to sell their entire stakes (50-50) in the Anasuria Cluster in the UK Central North Sea to a Malaysian joint venture consisting of Ping Petroleum and Hibiscus Petroleum.
News reports put the sale price at US$105 million. The deal is still subject to regulatory approval, but if approved, the sale is effective from 1 January 2015. The acquisition marks both Ping and Hibiscus’ entry into the North Sea market.
The Anasuria Cluster is 175km (115mi) east of Aberdeen and consists of a 100% interest in the Anasuria FPSO, Teal, Teal South, Guillemot A fields and a 38.65% interest in the Cook field. Ithaca Energy owns and operates the remaining 61.35% of the Cook field. Originally installed in 1996, the FPSO (pictured, right) sits at 89m (292ft) water depth. With a 850,000 bbl storage capacity, it was Shell’s first purpose-built floating production unit in the North Sea. Oil is transported via shuttle tanker and gas is exported via the Fulmar pipeline to St Fergus.
The news of the sale isn’t out of left field for Shell. While the supermajor announced an investment plan this January, the company made it known that it wished to sell Anasuria as well as the Nelson and Sean platforms back in February 2014.
The 2015 investment planned called for an eight-week shutdown of the FPSO in 2H to extend vessel life and improve operational efficiency. Additionally, a new production riser will be installed at Cook field during the shutdown.
“The cluster represents an attractive, geographically focused package of operated interests in producing fields and associated infrastructure,” Hibiscus said in a joint announcement. “The assets have a proven and producing resource base, which provides a platform for further development. A number of incremental development and exploration opportunities exist within the license areas, which are expected to generate significant incremental value in the medium term.”
Hibiscus Petroleum’s managing director Ken Pereira said of the acquisition: “We will be able to cut our teeth as operator in conjunction with Ping in one of the world’s foremost oil and gas production basins. The Anasuria Cluster has development potential for a company of the size of Hibiscus and provides us with an excellent foundation upon which we can build a significant North Sea presence.”
Shell announced in March that it planned to reduce staff and agency contractor positions that support its UK North Sea operations by 250.
“The North Sea has been a challenging operating environment for some time,” said Paul Goodfellow, Shell’s upstream vice president for the UK and Ireland, at the time. “Current market conditions make it even more important that we ensure our business is competitive. Changes are vital if it is to be sustainable. They will be implemented without compromising our commitment to the safety of our people and the integrity of our assets.”
While Shell decided to sell the Anasuria cluster and reduce positions in the UK, British supermajor BP announced plans this week to further invest $1 billion in the nearby Eastern Trough Area Project (ETAP) as part of a platform renewal life extension project.
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