Abu Dhabi National Energy Company, known as Taqa, yesterday completed its acquisition of BP's assets in the North Sea, increasing its global oil output by a third.
Taqa bought stakes in three fields in UK waters from BP for US$1 billion last November, adding 20,000 barrels per day (bpd) to its production. It became legal owner of the former BP assets at the beginning of the year.
"This investment is a great strategic fit for Taqa," said Carl Sheldon, Taqa's chief executive.
With the purchase completed, Taqa is now the operator at the Harding field, where it has taken on a 70 per cent stake. The company is already the operator in a range of North Sea fields, and the move towards further responsibility is part of its strategy to increase its expertise.
The BP transaction also gives Taqa access to two further fields and increases its stake in fields that are already part-owned. The company gained a majority stake in a fourth field, where BP retains rights to the bulk of the underlying cash flow. In addition, Taqa increased its stakes in oil and gas pipeline systems in the area.
These interests now include the Morrone and Maclure fields as well as an increased share in the Brae area, the Sage gas pipeline and Forties-Brae and Forties-Braemar oil pipelines.
"We don't want to be just a portfolio investor and don't want to just hold minor equities. We want to be operators, and we want to gain that operating experience, in part so we can translate that around the world," said David Cook, Taqa's head of global oil and gas.
The bulk of the company's assets lie in power plants in and around Abu Dhabi, and Taqa is in turn majority owned by the Abu Dhabi Water and Electricity Authority. But the investor has built up a portfolio of oil and gas assets in Europe and North America, and seeks to use these to gain experience it can transfer into the Mena region.
"We are delighted to announce the completion of this acquisition, which extends the average life of our UK reserves and opens up a bright future for our North Sea business," said Mr Sheldon.
Last year, Taqa bought rights to an oil and gas block in the Kurdish region of Iraq, and it submitted a full field development plan to the Kurdish Regional Government last month.
With the Mena region identified as a growth market, Iraq has crystalised as an investment target. Building on a stake in a gas-fired power plant, Taqa is keen to develop midstream assets, such as oil and gas and pipelines and processing facilities, in particular.
The company last year signed a deal to develop coal mines and power plants in Turkey, and could link those two markets with investment in pipeline infrastructure connecting the countries. Taqa shares closed trading on Thursday 0.8 per cent higher at Dh1.29 each.
* with Dow Jones