The assets include a 37.5 percent operated interest in the Markham gas field, which straddles the UK/Dutch border, a 4 per cent non-operated interest in the J3C field in the Dutch sector, and a 12.5 percent non-operated interest in UK Block 43/20d, an exploration license.
The company received funding for the transaction from its existing investors, 3i plc, Europe's leading venture capital company and Trust Company of the West ("TCW"), a US-based investment management company.
CH4 will take over Eni's office in Hoofddorp in the Netherlands and the 60 onshore and offshore staff currently responsible for Markham operations. This company has been re-named CH4 Nederland BV and will continue to operate the Markham field with all the staff remaining in their current roles.
Mark Routh, Managing Director of CH4, commented: "We are delighted to have completed the acquisition of Markham with the support of 3i and TCW. Markham is an excellent asset upon which we hope to build a core area of our business. Its trans-median location presents us with opportunities to increase our involvement in both the UK and the Dutch sectors of the North Sea. We are also pleased to augment the CH4 team with the current operating staff in the Netherlands who have so ably managed the Markham field in recent years. Together we will deliver our business plan to build a significant portfolio of gas infrastructure and reserves and use that infrastructure to bring undeveloped gas to the European markets."
Graeme Sword, Director of 3i's Oil and Gas business, said: "We are very pleased to support CH4's acquisition of Markham. CH4 is a company we have backed from start-up which shows that 3i is committed to supporting top-quality teams in the changing North Sea environment."
Blair Thomas, managing director of TCW's energy group, added: "We are pleased to back a seasoned management team that is well positioned to capitalize on favorable long-term trends we see in this market. CH4 has the right blend of experience and entrepreneurial initiative to create long-term value for all involved and this is the perfect match to bring TCW's expertise to the North Sea sector."
Mark Routh, Phil Kirk and Francis Gugen, three former senior executives from Amerada Hess, launched CH4 Energy Limited with backing from 3i in October 2002, with the aim of investing in gas reserves and infrastructure in the North Sea. This is CH4's second acquisition. In July 2003 CH4 acquired a 25 per cent stake in the ETS gas pipeline, which runs from the Trent & Tyne fields in the Southern North Sea to the Bacton gas terminal on the coast of Norfolk.
Markham currently handles gross production of 240 million cubic feet of gas per day, (about 6 million cubic metres per day or 40 thousand boe per day), from two platforms and four satellite fields; Windermere in the UK and J3c, K1A and K4D in the Netherlands. Markham gas is produced from 9 wells and two platforms. One platform is in the Dutch sector (manned); the other is in the UK sector and is normally unmanned. The Markham gas is sold to Gasunie and Wintershall at the Den Helder gas terminal in the Netherlands.
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