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September 20, 2022

Deep-water oil explorer QuarterNorth exploring potential sale

The deal could value the company at over $2bn, including debt.

Gulf of Mexico oil driller QuarterNorth Energy is considering the potential sale of the business, reported Reuters, citing people familiar with the matter.

According to the report, the deal could value the company at over $2bn, including debt.

In recent weeks, the deepwater oil explorer has been working with an undisclosed investment bank on its strategic options.

QuarterNorth is soliciting offers from potential buyers, the sources told the publication.

In this year, the privately held company is expected to generate approximately $850m of earnings before interest, tax, depreciation and amortisation (EBITDA).

The asset owners in the US Gulf of Mexico have been offloading projects to capitalise on surging energy prices.

QuarterNorth is the successor of Fieldwood Energy, which declared bankruptcy in 2020.

Some of the creditors of Fieldwood formed QuarterNorth in 2021, following the acquisition of most of Fieldwood’s assets for $1bn.

In July 2022, Reuters reported that ConocoPhillips was looking to divest its stake in the Ursa platform and Princess subsea well in the Gulf of Mexico. Shell was also considering the sale of assets in the Gulf of Mexico.

Earlier this year, Norway’s Equinor agreed to sell a 51% stake in the North Platte deep water development project in the US Gulf of Mexico to Shell.

The project straddles four blocks of the Garden Banks area, 275km off the coast of Louisiana, in water depths of approximately 1,300m.

Upon completion of the transaction, Equinor will hold a 49% stake in the project.

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