Market sources reveal US giant Conoco to quit North Sea oil production in £2bn sell-off

BP Clair field, Clair Ridge
ConocoPhillips has a 24% stake in the BP-operated Clair field, Clair Ridge

US oil giant ConocoPhillips is preparing to sell its North Sea fields as the company focuses on shale operations in its home market, industry and banking sources said.

The disposal of Conoco assets after more than 50 years in the North Sea could fetch as much as $2 billion, but it was unclear how much of the portfolio would be put up for sale, the three sources said.

Conoco is the latest major oil company believed to be seeking to quit the North Sea as production from the ageing basin declines, while other areas become more competitive and costs for dismantling increasingly elderly and end-of-life platforms and subsea infrastructure weigh.

The company has yet to launch a formal process or appoint a bank but a Reuters report said executives from Conoco have spoken in recent weeks to a number of North Sea operators and bankers to “gauge the appetite for the sale”.

The assets include a 24 percent stake in the West of Shetland Clair field, which its operator BP says is the largest undeveloped oil and gas resource in the UK North Sea.

The Clair Ridge project is expected to begin production this year. Other fields include holdings in the Britannia and J-Block hubs.

Conoco’s production in the UK North Sea reached 75,000 barrels of oil equivalent per day in 2017.

The company tried to sell some of its North Sea assets in 2014 but the process failed, the sources added.

David Currie
David Currie

Meanwhile, David Lamont has stood down as chief executive of Proserv, the offshore oilfield services contractor after a £50 million takeover of the company by its two largest lenders – KKR and Oaktree Capital Management Ltd LP.

He has been replaced by David Currie, who was previously chief executive of a subsea cabling company and former president of Aker Solutions North Sea.

15 May 2018

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