Ithaca to take full control of UK Cambo field
London-listed Ithaca Energy has announced it will buy the remaining 30% stake in the UK's Cambo oil and gas field from Shell, giving it full control of what is the UK North Sea's second largest undeveloped hydrocarbon discovery.
Located west of the Shetland islands, Cambo is estimated to hold 175mn barrels of oil in place and some 1.5bn m3 of gas, but its development has been help up by environmental scrutiny. Shell, which farmed into the project in 2018, announced its intention to divest in late 2021, citing weak economics and the risk of delays.
The acquisition of Shell's interest has "minimal near-term cost exposure," Ithaca said, while giving the company full control over the progress of its development.
"Our primary focus continues to be the delivery of our BUY, BUILD and BOOST strategy, including the future development of Cambo, subject to fiscal conditions," Ithaca CEO Alan Bruce said in a statement. "We believe that Cambo has an important role to play in providing energy security and economic benefit to the UK, while reducing overall emissions intensity."
The price has not been disclosed, but Ithaca said that the consideration is payable on first oil or receipt of proceeds from any subsequent farm out by Ithaca, and was subject to the company taking a final investment decision and/or the development receiving regulatory approval.
Ithaca, wholly-owned by Israeli group Delek, acquired its current 70% position at Cambo last year through the $1.1bn takeover of former operator Siccar Point. The company also has a stake in the UK's largest undeveloped oil and gas resource Rosebank, operated by Equinor. The regulatory approval process for that project is ongoing.