RE: Tipped by Simon Thompson in I/C6 Feb 2026 07:49
Im-traded energy group Parkmead (PMG) transformed and materially de-risked its investment case when it completed the sale of its UK offshore petroleum licences to Serica Energy (SQZ) in April 2025.
The offshore sector faces ongoing challenges due to the current political environment towards UK oil & gas, and the UK government’s net zero strategy. In this context, Parkmead’s board believes these UK North Sea oil licences would be best served within the portfolio of a larger company, thus enabling it to apply its expertise and resources on growing its Netherlands gas assets and UK renewable energy projects.
Aim: Share price: 15.5p
Bid-offer spread: 15.25-15.75p
Market value: £17mn
To date, the group has received cash payments of £7mn from Serica and is due further deferred cash considerations of £3.1mn and £3.9mn on 27 February 2026 and 27 February 2027, respectively. These future payments are not subject to any conditions. In addition, Parkmead could receive two contingent payments worth up to £120mn, payable upon receipt by Serica of approval from the North Sea Transition Authority for any field development plan (FDP) relating to licence P2400 (containing the Skerryvore prospect) or licence P2634 (containing the Fynn Beauly oil discovery).
These contingent cash payments will be calculated based on £0.80 per barrel of the 2P reserves contained within the respective FDP, net to the former subsidiary’s previous 50 per cent working interest in each licence, subject to caps of £30mn and £90mn, respectively.
Parkmead Group: Summary of Serica Energy transaction
Consideration overview
Initial cash payment £5mn
Deferred Payment (27 February 2025) £2mn
Deferred Payment (27 February 2026) £3.1mn
Deferred Payment (27 February 2027) £3.9mn
Total firm consideration £14mn
Contingent Skerryvore Payment Up to £30mn
Contingent Fynn Beauly Payment Up to £90mn
Total contingent consideration Up to £120mn
Total consideration (firm & contingent) Up to £134mn
Source: Company and London Stock Exchange RNS
The disposal not only removed any risk to Parkmead from these two potentially large UK offshore projects, but means the group retains an attractive portion of the potential upside associated with both Skerryvore and Fynn Beauly, with no further financial exposure. Excluding the next deferred cash payment (£3.1mn) due from Serica later this month, the group retained cash of £13.2mn at its last results, held a term deposit of £0.4mn and an interest-bearing loan asset of £2.7mn (since reduced to £2.4mn). The loan earns Parkmead an interest rate equivalent to the Bank of England base rate (currently 3.75 per cent) and expires in December 2028.
Parkmead made the loan to Energy Management Associates (EMA), a company associated with the group’s executive chair Tom Cross, as part of an exclusivity agreement whereby Parkmead has first rights over all renewable energy projects originated by the company. Cross owns 25.8 per cent of Parkmead
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