LONDON (ShareCast) - Oil explorer Serica Energy is buying an 18% stake in the Erskine oil field in the North Sea from BP for $11.1m plus 27m new shares.

Serica is buying the interest in UK blocks 23/26a and 23/26b, both in area B, containing the Erskine Field in the UK Central North Sea, from BP Exploration Operating Company and Britoil, both wholly-owned subsidiaries of BP.

The deal depends on consent of the other participants in the Erskine Field and related agreements and on approval by the British government.

Serica said the deal would give it an immediate and long-term cash flow stream.

Net production of the assets is estimated to be 1,234 barrels of oil equivalent per day after providing for planned maintenance shutdowns.

It also increases Serica's proven and probable reserves from an estimated 5.2m barrels of oil equivalent (mmboe) to an estimated 8.8mmboe.

Serica's Chairman Tony Craven Walker said the deal would expand its existing Central North Sea oil operations.

"BP will be taking an interest in Serica as a result of the transaction and we welcome BP as a shareholder. Serica intends to build upon this acquisition to secure a stronger presence in the UK as well as overseas where we are seeking to broaden our existing portfolio in Ireland, Morocco and Namibia."

PW

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