Trump sanctions against Iran delay sale of BP North Sea oil assets to Serica Energy

The Rhum N. Sea field ... still owned by BP for now.
The Rhum N. Sea field … still owned by BP for now.

The sale of BP oil wells in the North Sea to a rival operator has been caught up in the diplomatic cross-fire between the USA and Iran.

US President Trump has imposed tough new economic sanctions against the Mid East oil giant over what Washington sees as its plans to develop nuclear missile warheads.

As a result, BP’s sale of the Bruce, Keith and Rhum fields to Aberdeen-based Serica Energy have been on definite ‘hold’ because the Iranian state oil company holds a 50% stake in these fields through a subsidiary UK limited holding company.

The BKR fields (Bruce, Keith and Rhum) together produce up to 5% of UK indigenous gas production.

Both BP and Serica remain fully committed to completion of the transaction, which was expected in the third quarter of 2018.

Last night, a Serica Energy spokesman said: “Certain services in support of Rhum field operations are currently provided under authorisations obtained from the US Office of Foreign Assets Control (OFAC).

“The current OFAC licence issued to BP enabling the provision of goods, services and support by certain US persons, expires on 30 September 2018.

“Both Serica Energy and BP have made applications for a renewed licence beyond that date. Meetings are scheduled to take place with OFAC in the next few weeks.”

Mitch Flegg
Mitch Flegg

Serica chief executive Mitch Flegg, commented: “As a British company working to maximise the full recovery of Britain’s gas reserves in line with OGA and UK government policy, we are working with our partners and the UK government to identify measures, acceptable to the US authorities, to protect safe and efficient Rhum operations and ensure maximum economic recovery of reserves from this valuable UK resource.

“Meanwhile, all aspects of completing the BKR transaction remain on track: an Aberdeen office has been identified; key staff are being recruited and the transition process of moving operational staff and contracts from BP to Serica is well advanced.”

23 May 2018

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