Serica Energy plc (LSE:SQZ) has agreed to acquire a portfolio of Southern North Sea assets from Spirit Energy Limited in a deal valued at £57 million, with completion targeted for the second half of 2026. The transaction is expected to materially enhance Serica’s reserve base and production profile within the UK Continental Shelf.
A key element of the acquisition is an interest in the Cygnus gas field, one of the largest producing gas assets in the region. The additional assets are expected to be immediately cash generative, with management estimating around $100 million of free cash flow by 2028. The deal also broadens Serica’s operational footprint while maintaining a disciplined approach to decommissioning exposure.
Strategically, the acquisition supports Serica’s long-term growth ambitions and strengthens its position in the Southern North Sea, complementing its existing asset portfolio. The company continues to focus on generating strong cash flows while managing operational and regulatory risks.
From a market perspective, Serica benefits from a solid balance sheet and an attractive dividend yield, which provide some downside support. However, technical indicators point to bearish near-term momentum, and valuation metrics remain challenged due to the absence of earnings. In addition, operational execution and regulatory developments remain key factors to monitor.
More about Serica Energy
Serica Energy plc is an oil and gas exploration and production company with a strong focus on the UK Continental Shelf. The group is engaged in the development, operation, and management of offshore hydrocarbon assets, with an emphasis on maintaining a balanced and cash-generative portfolio.
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