2nd Jun 2015 06:17
LONDON (Alliance News) - Premier Oil PLC said it will consolidate production at the Solan field in the UK North Sea as it takes full ownership of the project after acquiring the 40% stake in the project it did not already own.
The FTSE 250-listed company has acquired Chyrsaor's 40% stake in the field for no upfront consideration. In return, Premier will pay Chyrsaor a payment of up to USD3 million per year and royalty payments of up to USD100 million, after allowing the repayment of the USD530 million plus interest of the outstanding loan provided by Premier to Chyrsaor.
As a result, Premier said it will consolidate all the production from the Solan field, and said it believes royalty payments would become payable to Chyrsaor at an average price of USD75 per barrel.
Separately, the oil giant has entered into an agreement with FlowStream Commodities for FlowStream to pay USD100 million upfront to Premier for the proceeds of 15% of production from the Solan field "for a period of time", dependent on the field's production levels and future oil prices.
By Joshua Warner; [email protected]; @JoshAlliance
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