* Shell deal makes Chrysaor largest UK independent producer
* Looks for deals across North Sea
* To boost share of operated assets to 50 pct
* Best way to cut costs is to increase production - CEO
* To withdraw production cessation plan for Armada hub
By Karolin Schaps
LONDON, Jan 31 (Reuters) - Chrysaor, which has just boughtmuch of Shell's UK North Sea assets for up to $3.8billion, said it was in the market for more North Sea deals toexpand its newly acquired position as one of the basin's biggestindependent producers.
Overnight, Chrysaor became one of the largest oil and gasproducers in Britain with output of 115,000 barrels of oilequivalent per day, snapping up more than half of Shell'sBritish production capacity, including the Buzzard field whichhelps to set the global Brent oil benchmark.
Chrysaor, backed by private equity fund EIG Partners andNoble Group investment firm Harbour Energy, said itwill not stop there.
"Our focus will be in the North Sea on assets that addsynergies or help us broaden or deepen our portfolio," saidLinda Cook, who has taken over as chairman of Chrysaor. She haspreviously been managing director at EIG and chief executive ofShell's gas and power business.
Cook said the company was considering acquisitions in theBritish and other parts of the North Sea.
The independent producer's break into the mature North Seamarket mirrors a trend whereby traditional operators such asShell and BP are slowly withdrawing from old basins tofocus on new areas where prospects for new big-ticket oil andgas finds are higher.
Chrysaor, named after one of Medusa's sons in Greekmythology, said operating costs across the new assets are below$15 a barrel. Brent crude oil prices are currently trading above$55 a barrel.
Around one quarter of its portfolio is now operated assets,meaning Chrysaor is the main manager of the fields.
"We do have a medium-term plan to build operatorships closerto 50 percent," said Phil Kirk, chief executive of Chrysaor.
As oil prices have fallen over the past two and a halfyears, many large operators have cut costs to the bone, lettingstaff go and investing much less in finding new fields.
"We see our philosophy as radically different to that. Wesee the best way to reducing unit costs is to drive up volumesof hydrocarbons processed," Kirk said.
He has already earmarked 6 or 8 new wells which Chrysaorwill likely approve for investment, but which would have beenunlikely to get approval under Shell, he said.
The new owner also plans to withdraw an application forcessation of production at the Armada hub of gas fields and toinvest in extending production instead.
(Editing by Jane Merriman)
