ConocoPhillips (NYSE:COP) Sells UK Oil & Gas Production Unit For $2.7 Billion

Marco Green
April 20, 2019

A privately owned oil company that was barely heard of until two years ago will become the largest producer in the UK North Sea this year after striking a $2.7 billion deal to buy an American energy giant's fields.

The latest deal comes after private equity-backed Chrysaor bought up a package of North Sea assets from Shell in 2017 for up to US$ 3.8bn.

The transaction will be completed in the second half of 2019. Oil company Chrysaor counts almost 2.7 billion dollars for the two gas fields in British waters and an interest in another field in Shetland.

A spokesman for the firm said a workforce consultation get underway upon completion of the deal towards the end of the year and the number will be decided at a later date.

Houston-based ConocoPhillips will meanwhile keep a London-based commercial trading business and its interest in and operatorship of the Teesside oil terminal in the northeast.

In the UK Southern North Sea, Chrysaor will assume responsibility for an ongoing decommissioning program on ConocoPhillips UK's end‐of‐life assets.

Reuters had reported on Wednesday that Chrysaor and Conoco were close to sealing the deal, citing sources close to the process who put the value of the assets at up to $2.8 billion.

The two subsidiaries indirectly hold ConocoPhillip's exploration and production assets in the United Kingdom, including associated decommissioning liabilities.

The North Sea has undergone a major transformation in recent years, as long-standing producers have sold assets to smaller players such as Chrysaor who say they can squeeze more money out of fields due to their nimbler operations.

He added that the business is seeking to extend its portfolio further through the acquisition of additional interests and acreage. In prepared remarks, ConocoPhillips Chief Executive Ryan Lance said investments would be focused "across future low cost of supply opportunities".

Other reports by Click Lancashire

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