Delek's Ithaca buys Chevron's North Sea assets

The UK-based oil and gas producer Ithaca Energy, part of the Israeli Delek Group, has agreed a $2-billion deal to purchase Chevron's assets in the North Sea. The acquisition will make it the second largest in the UK basin area.

The sale by Chevron is being hailed as the latest in a line of pullbacks from the North Sea basin by US-based companies. Earlier this year, ConocoPhillips sold off the majority of its operations in the region to Chrysaor.

There has been a general shift amongst US energy producers to refocus on US shale opportunities. By contrast, the ageing North Sea basin is ever increasingly populated by specialist operators, which are often smaller in size, who concentrate on squeezing out as much value as possible.

Les Thomas, the CEO of Ithaca said: “The acquisition of CNSL is a significant step forward in the long term development of Ithaca Energy and underlines our belief in the North Sea, particular in the UK Central North Sea where the enlarged business will own a range of interests in a number of key producing assets."

In a statement, Ithaca described the deal as "transformational". The company is forecasting a production rise of up to 300% as well as an increase of 150% in proven and probable reserves. 

Excluded from the deal was the 19% stake that Chevron owns in the Clair field, west of Shetland.

Asi Bartfeld, Delek Group CEO, added: “The acquisition is a key part of the Delek Group’s strategic focus on building a world class E&P business. Acquiring CNSL accelerates implementation of that strategy and further strengthens the group’s oil and gas business."

“We see exciting growth opportunities in the North Sea and are looking forward to working with Ithaca to deliver upon our value and growth targets.”

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