By Mark Williamson

Oil and gas entrepreneur Graham Stewart has unveiled plans to build another big business in the North Sea where he says he has unfinished business.

Ten months after the Faroe Petroleum business he led succumbed to a hostile takeover that valued the firm at £640 million, Mr Stewart has set out to raise backing for a new business that will focus on the North Sea.

He thinks investors could generate significant returns in the area in spite of the sharp fall in oil prices since 2014.

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Mr Stewart said there was a unique opportunity for the new Longboat Energy venture to develop a meaningful North Sea exploration and production business relatively quickly helped by acquisitions.

The company is targeting deals worth up to $200 million (£156m) and has already had talks with potential vendors about a range of interesting opportunities.

It is led by Mr Stewart and other members of the former management team at Faroe, which ran a business with interests in UK and Norwegian waters from Aberdeen.

Mr Stewart said: “We recognised that we still had a lot of discussions and opportunities out there that hadn’t come to fruition within Faroe before we were taken out in such an untimely fashion, so there was unfinished business to pursue and very exciting high potential value opportunities.”

The Longbow team has received encouragement from investors that Mr Stewart said had been central players on the former shareholder base at Faroe.

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Mr Stewart reckons Longbow could build a business that is at least as big as Faroe by capitalising on the ongoing shake up in the North Sea.

A range of big oil and gas firms have retreated from the area in response to the oil price fall.

Some US giants reckon there are better prospects in the shale fields of their home country. Utilities are cooling on the exploration and production business as they look to increase investment in renewable energy.

While he was running Faroe, Mr Stewart noted the retrenchment had created opportunities to buy North Sea assets at attractive prices.

Companies backed by financial investors have bought bumper portfolios while overseas oil and gas firms such as Israel’s Delek have made big expansion moves.

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“Private equity has sunk the best part of $15 billion in the North Sea so far since the oil price crash,” noted Mr Stewart yesterday. He added: “These are guys that think and study in great detail the investment opportunity.”

Longboat could be presented with acquisition opportunities as firms that have bought big portfolios look to rationalise their holdings.

Mr Stewart reckons the long term prospects for the oil and gas industry look good in both the UK and Norway.

London-based Longboat plans to raise up to £10 million from investors to help fund early stage operations.

It expects to list on the Aim stock market this month.

The company could establish a base in Aberdeen if it acquired assets that would best be managed from there.

Mr Stewart was left in line for a payout of around £13m in respect of his holding in Faroe's shares and related options following the takeover of the firm by DNO.

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Asked why he wanted to return to the fray, he said: “It’s a lot of fun. I didn’t plan to finish Faroe as early as it ended up. I think there is a big opportunity and I think I can make a contribution to that.”

A keen rock guitarist, Mr Stewart helped establish Faroe in 1998 after working at Aberdeen’s Dana Petroleum.

He has family links with the eponymous islands.