Angus Energy up for sale

The oil and gas company, Angus Energy plc, is considering a potential sale as part of a strategic review of its options.

In a statement this morning, Angus said it had “received indications that parties may be interested in making an offer for the company”.

Angus operates oil sites in southern England and is working to restart production at the Saltfleetby gas field in Lincolnshire.

The statement said it was also considering approaches for some or all of its 51% stake in Saltfleetby, including an indicative non-binding offer.

It said it was not currently in talks with any potential buyers but the company was now considered to be in an “offer period” as defined in the Takeover Code.

Saltfleetby site B. Image: Angus Energy

Angus said its share price, at less than 1p, did not reflect the short-term value of existing hydrocarbon assets and their immediate cashflow potential, or any longer-term value in geothermal projects. The statement said:

“The Board has now determined to undertake a review of the strategic options. These options include, but are not limited to, a sale of the Company which will be conducted under the framework of a “formal sale process” in accordance with the Takeover Code.”

The chief executive, George Lucan, said the market was attributing little value to hydrocarbon reserves in general, or in the prospects for the Saltfleetby Gas Field:

“In the light of this and the interest expressed by other energy market participants, we think it in the best interests of shareholders to conduct this strategic review and formal sale process.”

The company has appointed Beaumont Cornish as its financial adviser to handle any proposals.

Angus said it was confident that gas would be produced at Saltfleetby “in a timeframe which will not be material different from that advised”. It expected to provide more information on the construction and commissioning timetable during January. Another increase in the contingency for the project of up to 10% of the budget was also expected.

Last month the company announced it had delayed drilling a new sidetrack well at Saltfleetby until spring 2022. It has also applied for planning permission to change the layout of the Saltfleetby-B site and install a larger flare.

At the Brockham oil site in Surrey, Angus is seeking consent from the Environment Agency (EA) to reinject waste water. A public consultation is underway after the EA said it was minded to approve the operation.

Also last month, Angus said the target of its Lidsey oil field in West Sussex was not where it had been previously predicted. A new sidetrack could be drilled in 2022, the company said. No oil has been produced from Brockham since October 2018 or Lidsey since April 2020.

The company’s other interest, at Balcombe in West Sussex, has been suspended since September 2018. A planning application for an extended well test was refused unanimously in March 2021. Angus said it would appeal but there have been no details of a future inquiry by the Planning Inspectorate.

At the time of writing (9am), shares in Angus were up more than 15% at 0.90p.

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