The deal, which accounts for more than half of Shell's production in the North Sea, will breathe new life into the ageing North Sea where production has steadily declined since the late 1990s and where oil majors such as Shell and BP have struggled to generate profits. The Anglo-Dutch company said in a statement the North Sea deal included an initial consideration of US$3 billion and a payment of up to US$600 million between 2018-2021 subject to commodity prices, with potential further payments of up to US$180 million for future discoveries. Chrysaor, led by veteran North Sea executive Phil Kirk and backed by private equity funds Harbour Energy and EIG Global Energy Partners, will become the largest independent operator in the North Sea after the deal's completion. "This acquisition reflects Chrysaor's and Harbour's belief that the UK North Sea has material future potential for oil and gas production," Kirk said in a statement. The assets represent some 115,000 barrels of oil equivalent of production per day (boe/d), more than half of Shell's total UK North Sea production of 211,000 boe/d last year.

Source: The Edge Markets January 31, 2017 07:41 UTC