Faroe Petroleum has boosted its interests in the Ketch and Schooner gas fields in the UK North Sea to 60-percent each after a transaction with Tullow Oil, both companies reported Wednesday.
Faroe said that the deal sees it acquire Tullow's 60-percent interest in the Ketch field and a 53.1-percent stake in the Schooner unit, in which the junior oil firm already had a 6.9-percent interest. Faroe will also gain operator status over the fields.
Net production pertaining to Faroe from the two fields is estimated at between 3,000 and 4,000 barrels of oil equivalent per day – which is expected to increase the firm's average economic production in 2014 to between 7,000 and 10,000 barrels of oil equivalent per day. Faroe's proved and probable reserves will increase by an estimated 5.9 million barrels of oil equivalent to 33.1 million barrels.
Faroe Chief Executive Graham Stewart commented in a company statement:
"We are very pleased to announce this acquisition, funded entirely from existing resources and debt facilities, which significantly boosts and diversifies our oil and gas cash flow generation.
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