UK-based Energean Oil and Gas has signed an agreement to sell Edison Exploration and Production (E&P) North Sea assets to Neptune Energy Group for up to $280m.

The divestment of Edison E&P’s UK and Norwegian subsidiaries is part of the company’s ongoing plan to sell non-core assets.

Energean noted that the net proceeds from the sale would provide additional financial flexibility across the expanded portfolio. The company will initially receive $250m in cash and an additional $30m in cash contingent payments. The sale is subject to Energean completing the Edison deal.

In July 2019, Edison signed an agreement for the sale of 100% of its oil and natural gas unit Edison E&P to Energean for $750m. The move is part of Energean’s plans to expand in the eastern Mediterranean region.

Energean Oil and Gas chief executive Mathios Rigas said: “The acquisition of Edison E&P established Energean as the leading independent, gas-focused E&P Company in the Mediterranean with a mainly-operated, low-cost, gas-weighted portfolio and a highly experienced team to prosper in our rapidly changing industry.

“Neptune is a leading player in the UK and Norway upstream sectors and, as such, we are convinced that under Neptune’s ownership, Edison E&P’s UK and Norway teams will benefit from the increased focus and investment that will result from this strategic alignment.”

The assets under the sale include working interests in the Nova (15%) and Dvalin (10%) gas developments offshore Norway, and in the UK, and in the producing Scott (10.5%), Telford (15.7%), Tors (68%) and Wenlock (80%) fields.

Additionally, working interests in the Markham asset (3.1%), the Glengorm discovery (25%) and the Isabella licence (10%) would be sold to Neptune Energy. According to Energean, the units represent $408m of 2018 gross assets and $33m of 2018 losses before tax.

Following the announcement, Energean’s stock price rose by over 2% on the London Stock Exchange from 945p to 966p, giving the company a market capitalisation value of £1.7bn.

This has continued the company’s general rise throughout 2019, having started the year at 654.50p a share. However Energean’s recent share price has dipped from a peak of 1082p on 1 August.

Energean share price in 2019