Premier Oil buys E.On's UK North Sea assets
Posted on: 14/01/2016

London-based Premier Oil has confirmed that it will buy all of E.On’s UK North Sea assets in a deal worth roughly £83m ($120m). The exploration and production firm had suspended its shares on the stock exchange before the announcement.

Premier will buy assets located in the Central North Sea, West of Shetlands and the Southern Gas Basin. They will fund the acquisition from existing cash resources. E.On’s UK oil and gas upstream portfolio includes stakes in 40 licenses, including a 50% stake in the Tolmount discovery.

The deal will add around 15,000 barrels of oils equivalent per day to Premier’s production totals in 2016, according to the company.

Premier’s chief executive, Tony Durrant, said,

"Having recently completed the sale of our Norwegian assets for $120m, this transaction allows us to further consolidate our interests in the UK North Sea where any acquisitions are immediately value enhancing as a result of our existing UK tax position."

The sale of E.On’s North Sea assets follows the sale of its Norway exploration and production business at the end of 2015.

The company's chief financial officer Michael Sen said: "This transaction further strengthens our financial profile and provides flexibility to implement our strategy and to reposition the group.

"The outcome demonstrates that E.On E&P is a high-performing business with a strong asset base and superbly professional employees.

"Premier has a long history in the UK and I am convinced that the company will continue to build on this success story in the future."

The transaction has yet to be cleared by regulators and Premier Oil shareholders and lenders, and is expected to be closed in the first half of this year.

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