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Highlights
- Serica acquires BP’s 32% non-operated stake in Culzean gas field and adjacent licence.
- Upfront cash consideration of USD 232m, subject to adjustments and pre-emption rights.
- Culzean is the UK’s largest producing gas field, with 98% operating efficiency.
Serica Energy plc (LSE:SQZ) announced the signing of an agreement to acquire BP’s entire interest in the P111 and P2544 licences, located in the UK Central North Sea. The transaction includes a 32% non-operated working interest in the P111 licence, which holds the Culzean gas condensate field, and the adjacent P2544 exploration licence.
The Culzean field, operated by TotalEnergies, is currently the largest single producing gas field in the UK North Sea. Under the terms of the joint operating agreement, the acquisition is subject to a 30-day pre-emption period, during which partners TotalEnergies (49.99%) and NEO NEXT (18.01%) may elect to acquire BP’s stake on equivalent terms. Serica stated it will update the market as developments occur.
Management Comment
Chris Cox, Chief Executive Officer of Serica Energy, said:
“Should this transaction complete, it would deliver a step-change for Serica, adding material production and cash flows from the largest producing gas field in the UK. Culzean is a world-class asset, delivering gas from a modern platform with exceptionally high uptime and low emissions.”
Transaction Details
The acquisition has an economic date of 1 September 2025, with an upfront cash payment of USD 232m, subject to customary working capital adjustments. The amount will be partially offset by post-tax cashflows from the economic date to completion, expected around the end of 2025.
Additional contingent payments are linked to two factors: (1) successful results and production from an exploration opportunity on the P2544 licence, and (2) potential changes to the UK ring-fence fiscal regime.
Serica intends to fund the acquisition through a combination of cashflows from the Culzean interest and existing resources, including cash and undrawn capacity from its USD 525m Reserve Based Lending facility.
About the Culzean Field
Culzean is a mid-life gas condensate field operated by TotalEnergies in the UK Central North Sea. Discovered in 2008 and brought onstream in 2019, it remains the UK’s largest producing gas field.
As of the first half of 2025, BP’s net production from Culzean averaged approximately 25,500 barrels of oil equivalent per day (boepd), operating at an efficiency rate of 98%. Remaining net 2P reserves are estimated at around 33 million barrels of oil equivalent as of 1 January 2025.
Operating costs stand at USD 10.7 per barrel of oil equivalent, with emissions significantly below the UK North Sea sector average of 20 kg CO₂/boe.
