Apache consider North Sea sell off
Posted 06/10/2014 00:00
Apache Corporation, the North Sea’s third-biggest producer behind BP and Royal Dutch Shell, has hired Goldman Sachs to find a buyer. The move puts another question mark over the future of Britain’s offshore oil industry.
Oil and gas operator Apache is looking at withdrawing from its North Sea fields and either selling them off as an individual asset or spinning its entire international business into a new company.
Steve Farris, the company’s chairman, chief executive and president, said: “Apache continues to evaluate the separation of its international business through capital markets or strategic transactions.”
However Apache yesterday denied reports that Goldman Sachs was looking for bidders. “I can categorically state that Goldman Sachs has not been hired to sell 100 per cent of Apache’s business in the North Sea,” a spokesman said.
The US firm is the third-largest oil producer in the North Sea, behind BP and Royal Dutch Shell, and is the owner of Forties, the UK’s largest oil field.
Jake Molloy, RMT regional organiser, said any decision to pull out of the North Sea would be a "big shock" to the UK industry and a "severe blow" to everyone working in the sector, especially Apache employees and those providing contracting services to the firm. He claimed that other firms surrounding the Forties site who pump their oil and gas into the Forties pipeline system would also be hit by any decision to sell up.
Mr Molloy added: "The company only recently opened its new multi-million pound headquarters on the outskirts of Aberdeen, a state-of-the-art facility, and that, along with the not-long purchased Beryl field, served to suggest Apache were here for the long haul."
The Apache spokesman said the creation of "Apache International" would allow the firm's ventures outwith the US, including in Egypt and Australia, as well as the North Sea, to take control of their own income and expenditure.
He said this could lead to more investment in the North Sea, but added that the firm is already investing heavily in the UK market.
Mr Farris added: "In the United Kingdom North Sea, Apache is the most efficient oil and gas operator, with operating efficiency above 90 per cent compared with the industry average of approximately 60 per cent. Apache has revitalised major, mature assets acquired from other companies, including Forties, the largest oil field in the UK.
"In addition, Apache has pursued a successful exploration strategy resulting in the development of multiple new fields.
"Apache recently finalized the commissioning of a new platform in the Forties field this year, at the time when the field was expected to enter decommissioning before Apache gained operatorship."
Meanwhile, Brent crude oil prices continued to fall, down 1.2 per cent by the end of Friday.
With Brent plunging to $94 per barrel, analysts at Goldman Sachs said their conviction in a $100 per barrel forecast for 2014 was “waning”.