Ithaca Energy Picks Up Interest In Cook Oil Field

Acquired a 28.46% nonoperated interest in Cook oil field in Block 21/20a in Central North Sea, gaining 7,940 BOE/d, 5.75 MMBOE 2P.

Ithaca Energy Inc., Calgary, (Toronto Venture: IAE) has closed its acquisition of a 28.46% nonoperated interest in Cook oil field from Hess Corp., New York, (NYSE: HES) for US$57 million in cash and the transfer of a 10% interest in each of exploration blocks 42/25b, 43/16a and 43/21c in the Southern North Sea.

Ithaca originally planned to also acquire a 7.41% nonoperated interest in Maclure oil field as well for a total deal value for US$74.5 million, but this was dropped from the deal on May 16 due to a pre-emptive offer from the field's coventurers.

Cook Field, operated by Shell, lies in Block 21/20a in the Central North Sea. Gross average production from the field for 2010 was 7,940 barrels of oil equivalent per day (2,260 barrels net). Net proved and probable reserves as of year-end 2010 were 5.75 million barrels equivalent.

Ithaca chief executive Iain McKendrick says, “Significant nonoperated interests, particularly in the Cook Field, are highly strategic for the company. It permits the company to focus on extracting value from its existing operated portfolio, while being underpinned by additional nonoperated production and cash flow being generated though the acquisition.”

Ithaca funded the deal with existing cash.