ENERGY tycoon Ian Suttie’s First Oil yesterday bought a stake in Aim-quoted driller Bowleven’s East African operations in a deal that could be worth up to $25 million (£17m).
Under the agreement, Aberdeen-based First Oil, which is owned and chaired by Suttie, will take a 30 per cent stake in Edinburgh-based Bowleven’s “new ventures” unit, in return for funding exploration costs.
Up to $9m is available for an initial work programme, with $12.5m to follow.
The pair will also join forces to investigate “early entry exploration opportunities” across the Rift Valley in East Africa, with First Oil contributing $3.6m.
Steve Bowyer, managing director at First Oil, said: “We are pleased to announce our entry into the developing East African rift system and look forward to working in partnership with Bowleven.”
Kevin Hart, chief executive of Bowleven, added: “We are delighted to welcome First Oil as a strategic partner in our early stage exploration activities in East Africa and we look forward to working with the team in this exciting emerging area.”
First Oil was founded in 2001 and has grown to become the largest privately-owned British company producing oil and gas in the UK part of the North Sea.
Suttie made his fortune in 2001 when he sold oil-field services firm Orwell Group to American giant Weatherford International for £173m.
This year’s Sunday Times rich list estimates that his personal wealth stands at £450m. His fortune is expected to rise thanks to First Oil’s stake in the massive Kracken discovery off Shetland.