Tony Durrant: deals in line with stated strategy

Premier Oil has unveiled three acquisitions in the North Sea worth $871m as it seeks to consolidate assets in the region.

It is acquiring the Andrew Area and Shearwater assets from BP for $625 million, and an additional 25% interest in the Premier-operated Tolmount Area from Dana for $191m plus contingent payments of up to $55m.

Premier has announced the proposed extension of its existing credit facilities to 30 November 2023.

It said the acquired assets will generate more than $1 billion of free cash flow to end 2023

The proposed acquisitions will be funded via a $500m equity raise (net of expenses) which has been fully underwritten on a standby basis, existing cash resources and, if required, an acquisition bridge facility of $300 million.

Premier expects that the equity raise will include both a placing and rights issue. It expects to confirm the structure and terms in Q1 2020 following consultation with major shareholders.

The three acquisitions are expected to complete by the end of Q3 2020.

Tony Durrant, chief executive, commented: These acquisitions are materially value accretive for Premier and are in line with our stated strategy of acquiring cash generative assets in the UK North Sea.

We look forward to realising the significant long-term potential of the Andrew and Shearwater assets through production optimisation, incremental developments and field life extension projects.

We are also pleased to have consolidated our interest in the high return Tolmount development where we see material upside. The cash flow generated from the acquired assets will also accelerate the deleveraging of Premiers balance sheet.

Continued here:
Premier in $871 million swoop on North Sea assets - Daily Business

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