(Adds details on prospectus, shareholder meeting)
By Julia Payne
LONDON, Dec 16 (Reuters) - Premier Oil will be
renamed Harbour Energy Plc after the reverse takeover by private
equity-backed Chrysaor to create the British North Sea's largest
oil and gas producer, Premier said on Wednesday.
The merger is due to be completed by the end of the first
quarter 2021.
Premier was struggling to deal with a heavy debt burden
after its profits were slashed when oil prices were hit by the
COVID-19 lockdowns. The London-listed firm struck a deal with
Chrysaor in October.
Premier is due to release a shareholder circular and
prospectus in relation to the merger later on Wednesday. A
general meeting of Premier's shareholders to approve the
transaction is taking place on Jan. 12.
As part of the merger transition, Premier chief executive
Tony Durrant has stepped down from the board. Richard Rose, who
is also finance director, will take over as interim CEO on Jan.
1.
Once the merger is complete, Linda Cook will be the CEO of
Harbour Energy and Blair Thomas will become chairman of the
combined group.
The new company is expected to produce 200,000-220,000
barrels of oil equivalent per day (boed) next year.
Premier's output could rise slightly next year as new
production comes online and replaces declines elsewhere. The
firm expects 2021 production to be around 61,000-66,000 boed,
including new production from its Tolmount gas field. The
company's output has averaged 61,000 boed so far this year.
Chrysaor expects output to be 140,000-155,000 boed next
year, down from 2020, due to an unusually high level of asset
shutdowns due to COVID-19 related maintenance deferrals.
The equity-backed producer has hedged about 67% of its first
half 2021 oil output at an average $60 a barrel. It has also
hedged over 70% of its gas volumes.
Premier's takeover could herald wider consolidation but the
pool of buyers is small in a sector with an uncertain
outlook.
Leading oil and gas companies, including BP and Royal Dutch
Shell, want to sell large parts of their portfolios to prepare
for a shift towards renewable energy. Faced with ballooning
debt, smaller exploration and production (E&P) companies also
want to sell assets or partner with an investor.
(Reporting by Julia Payne, additional reporting by Shadia
Nasralla;Editing by Elaine Hardcastle)
