Serica Energy Plc (LON:SQZ) shares climbed around 6% in Monday’s early deals after it confirmed an important regulatory step, with a new licence from the US Office of Foreign Assets Control for the Rhum Field.
The latest licence runs until 4 November, replacing the prior licence which expired on September 30
Rhum is part of a package of assets that are being acquired from BP, though it is impacted by US sanctions on Iran because a subsidiary of the National Iranian Oil company holds a 50% stake in the field.
READ: Serica Energy Rhum operations impacted by US sanctions on Iran
In a statement earlier this year, the company explained that certain services that presently support the Rhum operations are provided under authorisations awarded by the US government.
Now, as the short-term arrangement is announced, Serica told investors that talks are continuing with OFAC over the conditions under which authorisation may be given beyond November 4.
"Serica welcomes the new licence which ensures that production from the Rhum field can continue,” said Mitch Flegg, Serica chief executive.
“Discussions with OFAC and other parties regarding longer-term arrangements to protect this valuable UK asset are continuing and all parties are working towards a successful conclusion.
Flegg added: “The transaction between Serica and BP under which Serica will acquire BP interests in the Bruce, Keith and Rhum fields upon receipt of the appropriate licences is an important part of this process and we are encouraged by the issuance of this interim licence.
“Both BP and Serica remain committed to completion."