The former head of Centrica’s oil and gas unit has launched his own North Sea-focused explorer after securing $500 million (£301m) in private equity backing.
Jonathan Roger, who joined the Scottish Gas parent following the £1.3 billion hostile takeover of Venture Production in 2009, said Siccar Point Energy will now seek out acquisitions of its own as oil majors scale back their North Sea exploration and production (E&P) activities.
He told The Scotsman: “Today’s a great time to set up a business focused on the North Sea. It has its challenges, but that brings opportunities from our perspective as many of the larger players are looking to reshape their North Sea portfolios or exit completely. That would be ideal for us to build this business on.”
Roger was chief operating officer of Aberdeen-based Venture before becoming managing director at Centrica Upstream, which he left in June last year.
Siccar Point, named after the famous geological site between Dunbar and St Abb’s Head, is backed by London-based private equity firm Blue Water Energy, which has been working with Roger over the past year to help draw up his plans.
Blue Water partner Graeme Sword said: “E&P is a key part of our fund strategy. We have a strong belief that there are continuing opportunities in the North Sea for well-managed companies with a clear strategy and access to capital.”
Singapore’s sovereign wealth fund, GIC, is co-investing behind Blue Water. Blackstone Energy Partners (BEP), the energy-focused arm of New York-based investor Blackstone, which has invested about $7bn in the sector over the last decade, came on board earlier this year.
Mustafa Siddiqui, managing director of BEP, said: “We are impressed with the capabilities of Jonathan and his team and look forward to partnering with them and Blue Water Energy to build Siccar Point into a leading independent oil and gas company.”
Last month, academics from Robert Gordon University said it was “plausible” that 24 billion barrels of oil and gas remain in the North Sea, as projected by trade body Oil & Gas UK, and rejected forecasts by the UK government’s budget watchdog as “ludicrously pessimistic”.
Roger said Siccar Point would focus on the “full life-cycle”, from exploration through to development and production, and the company is currently weighing up a number of possible deals as it seeks to build up “two or three” production hubs in UK waters.
He said: “A deal’s not going to appear immediately. We’re going to be patient because it’s all about finding the shape of deal for us. There are a lot of opportunities out there, and not all of them will fit our model.”
The Aberdeen-based firm is keeping its options open in terms of delivering an exit strategy for its investors, said Roger, who has assembled a senior team of former Venture and Centrica colleagues, including subsurface director Iain Bartholomew, finance director Doug Fleming and David Sheach, general counsel.
Roger added: “One of the attractions of our experienced E&P investors is they recognise it can take time to build value, so they know they may be in for a period of longer than five years.
“Therefore, whether we build it up and float it, or it’s taken into private hands, is something we’re open to. The focus for me is to build a great business and the rest takes care of itself.”