Viaro Energy has signed an agreement with Shell and Exxon Mobil to acquire full ownership of the companies’ U.K. Southern North Sea assets. (Source Viaro Energy)
London-based Viaro Energy, through its operating subsidiary RockRose Energy, has pulled the trigger on a major offshore deal to acquire Shell and Exxon Mobil's southern U.K. North Sea assets.
The acquisition, which is subject to regulatory approval, will see Viaro take full ownership of 11 Shell-operated offshore assets, one exploration field, production facilities and Shell’s onshore Bacton gas receiving terminal, Viaro said in its July 30 release.
The purchase includes offshore assets Barque, Brigantine, Caravel, Carrack East, Carrack Main, Clipper, Corvette, Cutter, Galleon, Leman, Shamrock and Skiff. All assets are connected to the Bacton terminal through the Leman and Clipper fields.
Gas shipped through Bacton is used to generate around 40% of Britain’s electricity, according to Viaro.
In 2023, the 11 fields produced 28,000 boe/d, accounting for about 5% of the U.K.'s total gas production.
Viaro has identified strong growth potential in the fields, with probable reserve volumes estimated at 58 MMboe and more than 120 MMboe of net best estimate of contingent resources projected to be extractable.
The tight gas development ongoing in Galleon and Barque fields are both indicative of the fields’ “lasting importance for the U.K.’s energy security,” Viaro said.
However, the purchase of the ageing wells and infrastructure could place a heavy burden on Viaro. The U.K. North Sea is a mature oil province having started production in the early 1960s. Most of the region’s wells are producing at a fraction of their peak output and many will need to be decommissioned in the coming decades.
“Hundreds of wells will need to be decommissioned every year as more oil and gas fields shut down,” the North Sea Transition Authority (NSTA) said in a July 16 release.
The NSTA is investigating missed deadlines for well decommissioning projects on the U.K. Continental Shelf that have increased forecast (plug and abandonment) P&A costs to $31 billion between 2023 and 2032.
RELATED
NSTA Opens Investigations into UK North Sea Decommissioning Delays
Pauline Innes, the NSTA’s supply chain and decommissioning director, wrote to licensees in November 2023 urging them to make headway on P&A and warned that failure to comply would bring consequences, including the use of sanctions, the authority said on July 26.
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