Oil price could ease Cairn’s pursuit of Nautical

By ERIKKA ASKELAND
Published on 23/06/2012 00:00

A PLUNGE in oil prices has raised hopes that Cairn Energy will succeed in its £414 million bid for North Sea firm Nautical Petroleum without risk of another firm muscling in on the deal.

The Edinburgh-based oil explorer yesterday published a document which said the transaction, being implemented by way of a scheme of arrangement which allows capital to be returned to Nautical shareholders, is set to complete by 8 August.

Cairn made its 450p-a-share bid at a hefty premium earlier this month, seen as an attempt to fend off possible interlopers.

The acquisition will double Cairn’s stake in the Catcher area, east of Scotland, which contains several large oil discoveries, and give it a 25 per cent stake in Kraken, east of the Shetland Islands, which are both expected to produce oil by the end of 2015.

It will be the company’s second acquisition in the region lately following its $450m (£288m) move for Norwegian rival Agora Oil and Gas in April.

Brent crude has plummeted 26 per cent in less than two months as signs mount of a slowdown in the global econ-omy, led by Europe, that would reduce demand for crude.

“Sentiment remains extremely weak, with the chances of any immediate sustained relief rally appearing rather limited,” a Barclays report said.