Serica Energy acquires UK North Sea assets for $25.6 million

Investing.com -- Serica Energy plc (AIM:SQZ) has signed an agreement to acquire 100% of Prax Upstream Limited from Prax Exploration & Production Plc (in Administration) for $25.6 million, the company announced Tuesday.

The acquisition includes a 40% operated interest in the Greater Laggan Area, a 10% interest in the Catcher Field, a 5.21% interest in the Golden Eagle Area Development, and a 100% interest in the Lancaster field.

The deal adds 11.0 million barrels of oil equivalent (mmboe) of 2P reserves at an acquisition cost of $2.3 per barrel. The assets produced a combined 13,800 barrels of oil equivalent per day (boepd) in the first half of 2025.

"This transaction represents a further step in the delivery of our growth strategy - it diversifies our portfolio, increases our reserves and resources, and enhances near-term cashflows at an attractive valuation," said Chris Cox, Serica’s CEO.

Upon completion, Serica will pay the upfront consideration and receive payments totaling an estimated $100 million, reflecting interim post-tax cashflows between the economic dates of each transaction and estimated completion dates.

The company expects an additional $50 million of free cash flow from the acquired assets in 2026. Completion of the acquisition is expected in Q4 2025, with the existing sale and purchase agreements to be completed in Q1 2026.

The Greater Laggan Area assets include the Laggan, Tormore, Glenlivet, Edradour and Glendronach fields, the onshore Shetland Gas Plant, and four infrastructure-led exploration licenses. These assets produced 5,000 boepd in H1 2025, with 90% being gas.

The Lancaster field, where Serica will have 100% interest, produced 5,900 boepd in H1 2025 but is not expected to produce beyond Q3 2026.

Following the acquisition, Serica’s portfolio decommissioning liability per 2P barrel will remain among the lowest in the UK North Sea, with near-term decommissioning costs primarily related to the Lancaster field.

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