NORTH Sea-focused Ithaca Energy is reported to be poised to buy a $1billion (£0.7bn) portfolio in a deal that would confirm there is still strong interest in oil and gas assets in the area.

The Israeli-owned oil firm is said by Reuters to have agreed to buy the North Sea assets amassed by Japan’s Marubeni.

The agency cited industry sources, without identifying any of them.

Ithaca said it did not comment on market speculation.

The Israeli group that owns Ithaca, Delek, has used the company to achieve rapid expansion in the North Sea with the support of acquisitions.

Delek supported Ithaca to buy a $2 billion portfolio from America’s Chevron in 2019.

That deal was completed amid a shake-up in the North Sea which has acquired fresh impetus as a result of the fallout from the pandemic. This resulted in oil and gas prices plunging to multi-year lows, before the advent of effective coronavirus vaccines fuelled a recovery.

READ MORE: Bumper North Sea portfolio sold by US oil and gas giant

Some firms decided to reduce exposure to the North Sea to free up funds to invest in other basins.

Growing calls for curbs to be placed on oil and gas exploration and production in response to the threat of climate change may dented investor enthusiasm for the sector.

Reuters noted that other Japanese firms are looking to exit the UK North Sea. There are reported to include JX Nippon.

But some firms may think now is a good time to buy oil and gas assets, in the expectation that there may be bargains to be had.

Delek recently made clear that it has been very pleased by the returns it has achieved on its investment in Ithaca.

In its second quarter results, the group noted that Ithaca doubled profits in the period to end June, to 217m Israeli Shekels (£50m).

READ MORE: Plan to develop billion barrel oilfield off Shetland set to be revived

However, Delek is considering floating Ithaca on the London Stock Exchange in a move that it would expect to generate cash for the group. It may not want Ithaca to make an acquisition that would tie up resources.

Last month Ithaca made the first find in the UK North Sea this year with the Fotla well. It is thought the find may contain around 20 million barrels.

In recent months Ithaca has submitted a plan to develop the Abigail field to the regulator and approved a £400m scheme to try to increase production from the Captain field north east of Aberdeen.

Delek bought Ithaca in a £1 billion deal in 2017.

READ MORE: Court cases threaten North Sea investment

Brent crude fell to an 18-year-low of less than $20 per barrel in April last year, from around $70/bbl before the pandemic. It sold for around $73/bbl yesterday afternoon.