Serica Energy (LSE:SQZ) reported average production of 27,600 barrels of oil equivalent per day in 2025, with revenue of $601m, both lower than the prior year but broadly in line with guidance. Reduced volumes, weaker realised oil prices and higher operating costs led to slightly negative free cash flow for the year and a move to a net debt position of around $200m, despite the continuation of dividend payments.
Operational performance has improved materially entering 2026. Maintenance and reliability work at the Bruce and Triton hubs has now been completed, with year-to-date production already averaging around 43,000 boepd and current rates close to 50,000 boepd. By contrast, the Lancaster field is expected to cease production in the second quarter of 2026 as the FPSO departs.
Strategically, Serica is positioning for a significant uplift in scale and diversification. Recently announced acquisitions are expected to more than double the number of producing fields in the portfolio, materially enhancing cash generation and reducing reliance on individual assets. Alongside this, the group is advancing a pipeline of organic growth opportunities, including potential infill drilling at Bruce and life-extension and emissions-reduction investments across the Bruce and Triton hubs.
Based on these developments, management is guiding to average production in 2026 well above 40,000 boepd, with potential peak rates exceeding 65,000 boepd. With hedging in place and meaningful free cash flow anticipated at current commodity prices, Serica also reiterated its intention to migrate its listing to the London Stock Exchange Main Market, aiming to establish itself as a larger and more resilient UK North Sea operator while continuing to balance growth and shareholder returns.
More about Serica Energy
Serica Energy is a UK-focused independent oil and gas company listed on AIM. Its producing asset base is centred on the Bruce and Triton hubs, alongside assets West of Shetland, generating revenues from a mix of Brent-linked oil and NBP gas. The group is pursuing a more diversified and cash-generative portfolio through a combination of organic investment and acquisitions, with plans to move its listing to the London Stock Exchange’s Main Market.
Leave a Reply