ISRAELI-owned Ithaca Energy has said it sees lots of potential to grow in the North Sea after clinching a deal to buy a $2 billion (£1.6bn) portfolio from Chevron amid the shake-up triggered by the crude price plunge.

The deal will make Aberdeen-based Ithaca one of the biggest players in the North Sea outside the ranks of the majors, with 500 staff to join from Chevron.

It represents a landmark in a process which has seen US giants retreat from the North Sea and shift investment to areas where they see better prospects, such as the shale fields of Texas.

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Chevron put its Central North Sea portfolio up for sale in July as returns came under pressure following the sharp fall in the oil price from 2014.

But Ithaca’s chief executive Les Thomas said the deal with Chevron had allowed the firm to buy a portfolio of quality assets from which it could generate good returns for years.The portfolio features stakes in 10 producing fields off eastern Scotland, including Captain and Alba.

“They have been in production some time, they are well understood but they are not late life,” said Mr Thomas of the fields in the portfolio. “There’s no near-term decommissioning liabilities for at least ten years.”

Noting production costs on the fields are low, Mr Thomas said Ithaca expects them to be commercially robust whatever happens to commodity prices.

Ithaca’s move provides a big vote of confidence in the North Sea as the area competes for investment with less mature basins.

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Mr Thomas said Chevron had looked after the assets Ithaca is buying well. But Ithaca expects to be able to make more from the portfolio than Chevron has done, by investing in projects that may not be material to a firm of the US giant’s scale.

This could see Ithaca drilling wells to boost production from existing fields and bringing finds on the acreage into production.

“It’s a nice set of assets and there’s lots of running room to do … various improvement projects that probably would not be of interest to a super-major but we think are great and will pay back quickly,” noted Mr Thomas.

He said Ithaca would bring a more entrepreneurial approach than a major would follow to the portfolio. But Ithaca is impressed with the quality of the staff who will join from Chevron. No job losses are expected as a result of the deal in the near term.

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“This is not about crunching a couple of organisations together to get cost synergies,” said Mr Thomas.

He said there could be a long future for the North Sea oil and gas industry amid the transition to other energy sources, which will help reduce carbon emissions.

Ithaca sees potential to make discoveries on the acreage it will acquire from Chevron.

More acquisitions could follow but the focus will be on integrating the Chevron portfolio initially.

Ithaca’s owner Delek Group said the acquisition was a key part of its strategic focus on building a world class exploration and production business.

“We see exciting growth opportunities in the North Sea,” said its chief executive Asi Bartfeld.

Tel-Aviv listed Delek bought Ithaca in 2017 in a deal that valued the firm at £1bn.

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Oil and gas consultancy Wood Mackenzie noted Chevron will be left with a 19 per cent stake in the Clair field West of Shetland once the deal with Ithaca closes. “A complete exit from the UK is looking increasingly likely,” it said.

Chevron said it had agreed to sell its UK Central North Sea business to Ithaca subject to regulatory approvals and other conditions without elaborating.

In April America’s ConocoPhillips agreed to sell its North Sea business to private equity-backed Chrysaor for $2.7bn.

Ithaca said the Chevron deal will allow it to quadruple production this year to around 80,000 barrels oil equivalent and grow reserves by 150% to 225 million barrels oil equivalent.