UK oil and gas producer Serica Energy plc is expanding its footprint in the UK North Sea with the acquisition of assets from Prax Group that would give it stakes and operatorships of additional oil and gas field in one of the world’s most mature offshore basins.
Serica Energy said on Tuesday it had signed an agreement to buy 100% of Prax Upstream Limited from Prax Exploration & Production Plc.
Prax Upstream holds 100% interest in the Lancaster field and is its operator.
In addition, Prax Upstream is party to separate executed sale and purchase agreements with TotalEnergies and ONE-Dyas to buy certain assets, including a 40% operated interest in the Greater Laggan Area (GLA), a 10% interest in the Catcher Field, a 5.21% interest in the Golden Eagle Area Development (GEAD), and a 100% interest in the Lancaster field.
Completion of the acquisition of Prax Upstream is expected in the fourth quarter of 2025 and of the deals for the other assets in the first quarter of 2026. Taken together, these transactions will make Serica Energy’s production portfolio more diverse and robust portfolio, with H1 2025 production of 7,900 boepd associated with the other fields and 5,900 boepd from the Lancaster field, which is expected to cease production in late 2026.
The agreements will create a new operated hub for Serica in the West of Shetland basin with multiple sources of organic growth potential, including an infill well on the Tormore field, the Glendronach development, four exploration licenses, and third-party throughput opportunities in the Shetland Gas Plant, the company said.
“There is an immediate boost to production and reserves, plus the scope to create significant value for shareholders through multiple subsurface, commercial, and further M&A opportunities,” said Chris Cox, Serica’s CEO.
The acquisition comes at a pivotal time for the UK North Sea oil and gas industry, which is calling for reform of the current punitive UK windfall tax on oil and gas operators.
The government has launched a consultation on what type of tax regime should come next, and is being urged to replace the windfall tax as soon as practicable – and not wait until 2030 – to avoid the demise of the UK oil and gas industry.
By Tsvetana Paraskova for Oilprice.com
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