EnQuest, Cairn strengthen North Sea hold

Kraken oil field one of the few showing momentum in the region.
By Daniel J. Graeber Follow @dan_graeber Contact the Author   |  Feb. 22, 2016 at 7:55 AM
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LONDON, Feb. 22 (UPI) -- Even as pressure builds on the North Sea energy sector, British energy company EnQuest said it strengthened its hold over the Kraken oil field.

For an undisclosed sum, Enquest announced it took a stronger hold on the Kraken field alongside its non-operator partner Cairn Energy. Kraken is one of the few fields slated to ramp up production in a North Sea sector facing pressure from the low price of crude oil.

EnQuest, itself facing financial strains, increased its stake to 70.5 percent in the deal with First Oil, which had no statement on the transaction. Cairn increased its stake to 29.5 percent.

First production from Kraken is expected next year, using a floating production platform. EnQuest in December said its spending on the North Sea field was reduced and now targeted at around $2.86 billion.

Field maturation and economic pressures are pushing the North Sea into decline. British energy company BP said it was reducing headcounts from the sector and last week, British energy services company Wood Group said it was cutting rates paid to its North Sea contractors because of negative market pressures.

Rates paid to about a third of its British-based contractors will be cut by around 9 percent in response to what Wood Group said were cost and efficiency challenges in the regional oil and gas sector.

Wood Group's rate reduction follows a 10 percent decrease for onshore contractors in 2014.

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