Petrofac, the British oil and gas engineering company with significant operations in the UAE, will spin off its ageing North Sea oilfields into a new joint venture with a Swedish oil company.
Petrofac to spin off oilfields
Petrofac, the British oil and gas engineering company with significant operations in the UAE, will spin off its ageing North Sea oilfields into a new joint venture with a Swedish oil company. The newly created company, called EnQuest, will have production capacity of almost 14,000 barrels per day (bpd) and look to squeeze more output from fields that are in decline.
"We are confident that the continuation of these assets, along with our staff, provide us with the skills, scale and financial strength to become one of the UK's leading independent oil and gas production and development companies," said Amjad Bseisu, the EnQuest chief executive. Mr Bseisu said the new company would focus attention on oilfields that had not been a priority for either Petrofac or its venture partner, the Swedish oil company Lundin Petroleum.
"These assets haven't been focused assets in either organisation," he said. "For EnQuest, this will be our bread and butter. These assets have significant oil in place and haven't had much drilling penetration for quite a while." The new company will be listed on the London Stock Exchange and will target production growth of 10 per cent per year over three to four years, said Ashley Heppenstall, the Lundin president and chief executive.
Petrofac has completed a number of major oil and gas projects in Abu Dhabi and operates a rig building yard in Sharjah. In 2008, the company formed a joint venture with Mubadala Development, the Abu Dhabi Government company, to focus on projects in the Gulf. Petrofac's share price was down 4 pence to 1,091 pence yesterday after initially dipping to 1,067 pence. Lundin will also spin off its British production assets, but said it would continue to produce oil and gas in other parts of Europe, Russia, Indonesia and Tunisia totalling between 29,000 and 33,000 bpd.
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