Serica Energy plc (LSE:SQZ) announced on Tuesday that it has entered into an agreement to acquire 100% of Prax Upstream Limited from Prax Exploration & Production Plc (in Administration) for $25.6 million.
The acquisition encompasses a 40% operated stake in the Greater Laggan Area, a 10% interest in the Catcher Field, a 5.21% stake in the Golden Eagle Area Development, and full ownership of the Lancaster field.
The deal adds 11.0 million barrels of oil equivalent (mmboe) in 2P reserves at an acquisition cost of $2.3 per barrel. In the first half of 2025, the combined assets produced 13,800 barrels of oil equivalent per day (boepd).
“This transaction represents a further step in the delivery of our growth strategy – it diversifies our portfolio, increases our reserves and resources, and enhances near-term cashflows at an attractive valuation,” said Chris Cox, Serica’s CEO.
Under the terms, Serica will pay the upfront consideration and is expected to receive payments totaling roughly $100 million, reflecting interim post-tax cashflows based on the economic dates of each transaction and estimated completion dates. The company anticipates an additional $50 million of free cash flow from these assets in 2026. Completion of the acquisition is targeted for Q4 2025, with remaining sale and purchase agreements scheduled for finalization in Q1 2026.
The Greater Laggan Area assets include the Laggan, Tormore, Glenlivet, Edradour, and Glendronach fields, the onshore Shetland Gas Plant, and four infrastructure-led exploration licenses. These assets contributed 5,000 boepd in H1 2025, with gas accounting for 90% of output.
The Lancaster field, in which Serica now holds full ownership, produced 5,900 boepd in H1 2025 but is expected to cease production after Q3 2026.
Following the acquisition, Serica’s portfolio will maintain one of the lowest decommissioning liabilities per 2P barrel in the UK North Sea, with short-term decommissioning costs primarily associated with the Lancaster field.
This content is for informational purposes only and does not constitute financial, investment, or other professional advice. It should not be considered a recommendation to buy or sell any securities or financial instruments. All investments involve risk, including the potential loss of principal. Past performance is not indicative of future results. You should conduct your own research and consult with a qualified financial advisor before making any investment decisions.
Leave a Reply