Ithaca Energy, a company focused on North Sea, has agreed to two farm-out deals, which is expected to bring down the cost of operations for the company.

Aberdeen-based oil and gas firm, Ithaca has already firmed out 25 per cent holding in two licences west of Shetland to a unit of Edison. Edison is also focusing on expanding its operations in the North Sea. Edison has said that the North Sea will emerge as its next production cluster in the International exploration and production operations. It already has operations from Mediterranean to the Falkland Islands.

Ithaca estimates showed that the farm-out deal as well as the effects of a deal agreed with RWE Dea in April will reduce the estimated share of its costs for a well planned for Handcross to $2.5 million, compared to $40 million before the deals were finalised. Ithaca retains 6 per cent paying interest in the well but has a 45 per cent stake in Handcross project. Ithaca has also agreed to farm out a 50 per cent share of UK offshore licence P2048 to Shell. The oil giant has also agreed to cover the costs of obtaining seismic survey data.

Chief executive Iain McKendrick said, "The monetisation of the UK exploration portfolio has far exceeded our expectations in terms of levels of expenditure carry. Ithaca shareholders are now exposed to some potentially high impact exploration at negligible cost."

Source Top News