Sector News

Neptune believed to be poised for swoop on North Sea

November 21, 2016

The oil and gas investment company led by former Centrica boss Sam Laidlaw is thought to be in advanced talks to snap up French-owned assets in the North Sea.

A potential deal giving London-based Neptune Oil and Gas control over stakes in the Cygnus and Juliet gas fields in the southern North Sea, as well as interests in the central North Sea and west of Shetland was first reported last month.

Engie – formerly GDF Suez – put all its oil and gas upstream interests, including the much-delayed Cygnus development and the other North Sea assets, under “strategic review” earlier this year as it turned its focus on low-carbon activities.

Neptune is backed by private-equity firms Carlyle Group and CVC Capital Partners, based in the US and Luxembourg respectively, which unveiled plans for a £3billion-plus swoop on “large oil and gas portfolios” last year.

Mr Laidlaw – an industry veteran – has since been working alongside the financial backers to identify opportunities arising in the North Sea, North Africa and south-east Asia.

Centrica’s former chief executive, now Neptune’s executive chairman, is now believed to be closing in on Engie’s exploration and production (E&P) assets.

It is thought Neptune would take 70%, alongside existing investor China Investment Corporation (CIC) – China’s £650billion-plus sovereign wealth fund.

And it has been speculated Neptune may bring in a partner to bid for assets outside of the UK North Sea.

Mr Laidlaw’s move reportedly follows a failed attempt by Engie to merge its E&P business with Centrica’s. CIC was said to have vetoed that deal.

Centrica and Engie, which opened new North Sea headquarters in Aberdeen in 2014, were seen to be highly complementary.

Engie/GDF Suez has had a presence in Aberdeen since 2009.

Its £1.4billion Cygnus project, sanctioned in 2012, was originally due to start pumping gas last year but is still not on stream.

Engie, Centrica and Bayerngas, with stakes of 38.75%, 48.75% and 12.5% respectively, have had to delay start-up after hook-up and commissioning delays. As recently as August, operator Engie was targeting the final quarter of this year.

The field is expected to contribute 5% to UK gas production at its peak, supplying gas to the equivalent of 1.5million homes.

By Keith Findlay

Source: Energy Voice

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