Serica Energy PLC (AIM:SQZ) has expanded its North Sea portfolio, agreeing to acquire Prax Upstream Limited in a $25 million deal.
It sees Serica pick up the Lancaster field plus a 40% operated stake in the Greater Laggan Area, a 10% interest in the Catcher field, and a 5.21% stake in the Golden Eagle Area Development.
Completion of the acquisition is expected in the fourth quarter of 2025, with associated transactions involving TotalEnergies and ONE-Dyas anticipated to finalise in the first quarter of 2026.
The deal is expected to add some 11 million barrels of oil equivalent of 2P reserves and establish Serica as the operator of the Shetland Gas Plant.
“This transaction represents a further step in the delivery of our growth strategy – it diversifies our portfolio, increases reserves and resources, and enhances near-term cashflows at an attractive valuation," said Serica chief executive Chris Cox.
The addition of GLA brings Serica a new production hub, with operatorship of the Shetland Gas Plant."
Cox added: "There is an immediate boost to production and reserves, plus the scope to create significant value for shareholders through multiple subsurface, commercial, and further M&A opportunities."
Oil and gas investors in London will likely remember Lancaster, which was discovered by Hurricane Energy which at one point estimated its 'multi-billion barrel' potential, before wells suffered performance issues and the company was squeezed by its debt financing arrangements. These days, the field is viewed more conservatively, based on its immediate production rather than potential.
The acquired assets were producing around 7,900 barrels oil equivalent per day in the first half of 2025. Lancaster accounted for 5,900 barrels per day, though the field is slated to wind down in the second half of 2026.
In London, Serica shares climbed 6.7% changing hands at 183.8p, valuing the oil and gas company at around £712 million.