- Guidance aims to remove blocks to transactions
- Energy transition aims supported by clear business dos and don’ts
- Increased cooperation will tear down barriers to investment
Multi-million-pound transactions will be helped to complete more smoothly following the publication of new guidance from the North Sea Transition Authority (NSTA).
Following extensive consultation with industry, the NSTA has finalised a set of recommended principles and practices which will encourage buyers, sellers and interested third parties to work together to ensure that transactions go through quickly and the full potential of the North Sea is met.
There are currently more than 100 transactions per year on the North Sea ranging from multi-million-pound transfers of field ownerships to smaller changes of Joint Venture (JV) partners. The guidance addresses the role each can play in helping these deals proceed efficiently.
Jane de Lozey, NSTA Director of Regulation, said:
'The energy transition requires significant investment as well as collaborative working between the many companies operating in the North Sea. This Guidance will assist that important process.'
Recommendations included in the Guidance are:
- Capability Pack – Created by the Buyer and Seller to inform Joint Venture partners of key corporate and financial information the JV requires to reach a decision
- Single Point of Contact – A single individual in both the buyer and seller with primary responsibility for communications
- Agreed timelines with milestones
- Candid, open, constructive negotiations
- Proportionate security arrangements to meet decom liabilities
The Guidance has been created to help industry minimise transaction delays which increase costs, prolong uncertainty, hold up operational and strategic decisions, damage trust and working relationships among companies working in the Basin and erect real barriers to investment.
The guidance will be reviewed and amended as appropriate. It can be viewed here.
See also: Response on consultation proposal to issue NSTA Guidance on the conduct of licence assignments
Source: NSTA
