EnQuest to acquire Bentley heavy oil discovery

EnQuest plc has agreed to acquire the proven North Sea Bentley heavy oil discovery from Whalsay Energy Holdings Ltd.

OPPORTUNITIES

The share purchase agreement (SPA) for 100% equity interest in licence P1078 is through the acquisition of Whalsay’s subsidiary, Whalsay Energy Limited (WEL) on a cash, liability and debt free basis.

“This discovery is within circa 15km of the group’s existing Kraken and Bressay operated interests, offering further long-term potential development opportunities and other synergies,” said EnQuest.

On completion, the company will fund certain accrued costs and obligations of WEL, expected to amount to less than $2 million.

EnQuest will make deferred payments to Whalsay based on future revenues generated by WEL, which are capped at $40 million.

Completion of deal depends on the Oil and Gas Authority granting an extension of the existing licence term, due to expire on 30 June 2021, and other third-party approvals.

As at 31 December 2019, WEL had gross assets valued at around $95m, consisting primarily of intangible assets representing historic capitalised exploration and evaluation activities on the Bentley licence.

For the year ended 31 December 2019, WEL recorded a loss before tax of around $72m, mainly resulting from the recognition of an impairment charge against the Bentley licence.

BENTLEY

Bentley is located in Block 9/3b, 150km east of the Shetland Islands in the UK North Sea.

It lies at a water depth of 113 metres, 15km east of the Kraken heavy oil field and 8km southeast of the Bressay field.

Bentley is “one of the largest undeveloped oil fields in the UK Continental Shelf with estimated stock-tank oil initially in place of circa 900 MMbbls”.

Discovered in 1977, the field has been appraised through the drilling and testing of six wells and two sidetracks.

Extended well tests in 2012 delivered production rates of around 3,500 bopd and an average 2,600 bopd over a 68-day well test.