EnQuest has signed a deal worth up to $375 million to acquire Suncor Energy UK’s entire stake of 26.69% in the Golden Eagle development in the UK North Sea.

As per the terms of the deal, the UK-based oil and gas company will pay an initial consideration of $325 million and a contingent consideration of up to $50 million payable in the second half of 2023, based on certain conditions.

The Golden Eagle development, which began production in 2014, comprises the Golden Eagle, Peregrine, and Solitaire fields.

Operated by Chinese state-owned firm CNOOC International, the Golden Eagle development is located nearly 111 kilometers northeast of Aberdeen, Scotland. Solitaire and Peregrine are satellite fields, which have been tied back to the facilities at the Golden Eagle field.

The Solitaire and Peregrine fields are producing under depletion.

The Golden Eagle development features six water injection wells, which are all on the Golden Eagle field.

Currently, a four-well infill program is in progress, of which two wells are onstream.

Through the acquisition, EnQuest adds immediate incremental production of around 10 kboepd, nearly 18 MMbbls in net 2P reserves and around 5 MMbbls to net 2C resources.

Amjad Bseisu – EnQuest Chief Executive said: “We are delighted we have agreed the acquisition of a material interest in Golden Eagle, a high-quality, low-cost UK North Sea development. Upon completion, this acquisition will add immediate material production and cash flow to EnQuest and will allow us to accelerate use of our substantial tax losses.

“It also demonstrates our continued commitment to the UK North Sea and diversifies our existing production base.

“The assets have a strong safety record and a lower than average CO2e emissions intensity ratio.

“We look forward to a productive partnership with the operator, CNOOC and our future joint venture partners, NEO Energy and ONE DYAS.”

The deal, which is subject to EnQuest’s shareholder approval, other closing conditions and certain regulatory approvals, is likely to close by Q3 2021.

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