NORTH Sea-focused Serica Energy has said it wants to make more acquisitions as it prepares to invest heavily in assets it has bought in the area.

Serica reckons it has become one of the 10 biggest independent operators in the UK North Sea after completing a series of deals that gave it operating control of three bumper fields East of Shetland.

The acquisition of stakes in the Bruce, Keith and Rhum (BKR) fields from BP and others allowed Serica to increase production to 30,000 barrels of oil equivalent per day. It was producing just 2,000 boepd before striking the deals concerned.

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In an update issued yesterday Serica said it planned to pay its first ever dividend, sending shares in the firm surging.

The London-based company underlined its appetite for more deals and signalled that it would consider buying other firms or individual assets.

“Serica’s continuing strategy is to identify asset acquisitions or corporate opportunities where we can add value,” it said.

The update provides further evidence that competition for assets is increasing in the North Sea as the shake up triggered by the crude price plunge from 2014 continues.

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“Despite the crowded marketplace, we still believe that there are opportunities to add to our portfolio,” said Serica.

The company is one of a number of players that decided moves by majors to retrench in the North Sea in response to the oil price fall created opportunities to buy assets at attractive prices.

The partial recovery in the crude price since 2016 may have helped stoke interest area.

Some big portfolios changed hands last year, with overseas oil and gas firms and financiers backing deals that showed they see plenty of potential in the area.

Serica reckons it has specialist skills that will allow it to cut deals that others might shy away from.

The company faced huge political uncertainty after acquiring a 50 per cent stake in the Rhum gas field. The remaining 50% is owned by the Iranian national oil company. Serica had to win an exemption from the US authorities to ensure production from the field could continue after Donald Trump imposed fresh sanctions on Iran.

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With production costs averaging around $13 per barrel oil equivalent last year, Serica has been generating lots of cash in the North Sea. It could use this to fund deals and investment in its acreage.

Noting that Serica is debt free, chief executive Mitch Flegg said: “We are exceptionally well-positioned to deliver sustainable value to all of our stakeholders through the successful implementation of our twin-track strategy of finding new growth opportunities whilst maximising production and minimising costs.”

Serica reckons it can generate good returns from investing in projects that majors may not consider to be material enough.

Directors said Serica intends to plan and execute three high-impact capital projects in 2020.

These involve bringing a third well on the Rhum field into production and preparing to drill an exploration well on the North Eigg exploration prospect nearby.

The company also expects to drill a well to develop the Columbus field, with first production expected in mid 2021.

Serica said it saw multiple growth opportunities in the Bruce catchment area. It noted the potential to boost production from existing fields and to make new finds.

The ambitious plans will boost hopes that transfers of ownership in the North Sea could provide a valuable boost to activity in the area.

While some firms have approved North Sea developments in recent months, sections of the supply chain remain under pressure.

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On the environment Serica noted:“Over 80% of our production is natural gas, which has significant environmental advantages over other fossil fuels and so is a key element of the UK’s Energy Transition” Flaring of waste gas fell 30% annually on the BKR assets in 2019.

Serica plans to announce detail of its maiden dividend in April along with its annual results.Shares in the firm closed up 13%, 15.4p, at 138p.