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May 26, 2021

JX Nippon considers sale of UK North Sea assets for $1.5bn

Japan's JX Nippon intends to exit UK North Sea operations, to shift its focus towards energy transition.

By Archana Rani

Japan’s JX Nippon is reportedly planning to offload its oil and gas assets in the UK North Sea in a transaction that is expected to be worth up to $1.5bn.

The firm is considering exiting stakes in some of the biggest fields in the basin, Reuters reported citing five banking sources.

According to the sources, Bank of America and Kirk Lovegrove have been appointed as advisers by JX Nippon for the sale.

Some of the assets considered for the sale include stakes in Andrew, Culzean and Mariner fields.

Located 150km east of Shetland in water depths between 97m and 112m, the Mariner field is operated by Equinor with a 65.11% stake.

The remaining interests are held by JX Nippon (20%), Siccar Point (8.89%), and Dyas (6%).

Discovered in 1981, the Mariner heavy oil field is estimated to hold 300 million barrels of recoverable oil reserves.

JX Nippon owns an 18.01% stake in the Culzean field, which is located in the North Sea, 230km off the coast of Aberdeen.

Total operates the Culzean field with a 49.99% interest while BP owns the remaining 32% stake.

As part of a shift towards energy transition, oil majors across the globe are seeking to hand over the North Sea oil and gas assets to private companies, allowing them to better exploit the remaining field reserves.

Earlier this year, it was reported that Japanese firm Marubeni is looking to divest its main oil and gas fields in the UK North Sea.

In recent years, Japanese oil producers such as Itochu and Idemitsu Kosan have exited from North Sea operations.

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