Access Investments-European Union- ROMANIA

An oil analyst with advisory group Peel Hunt, Werner Riding said: “I don’t think the North Sea is dead by a long shot. New successful companies will be born from this downturn, and it’s the smaller more nimble players who could benefit the most from low asset prices.” He added that small-cap players including Faroe Petroleum and Serica are both likely to complete deals within the next six months, at the bottom of the oil price cycle, before seller expectations become too optimistic. “I’d be surprised if both didn’t try to acquire more production assets before the end of the year. In particular Faroe will want to offset to the loss of production from the Njord area which is due to come offline this summer and will make a material impact on revenue if that production isn’t replaced,” he said. Faroe boss Graham Stewart confirmed that although the group is not currently in late stage discussions with anyone specific he expects to complete “a value enhancing acquisition by the end of the current year”.  A spokesman for Serica said the company is “keeping its ears to the ground”.  Mayfield’s Mr McKelvie said that as low oil prices have become entrenched asset-holders are beginning to accept a new economic reality which is helping to close the gap between bids and offers in asset sale talks. Meanwhile investors are more willing to support new deals, he said.  “Six months ago when we began looking at this people could see the opportunity but weren’t sure. But in the last two weeks we’ve been talking to investors and they’re more up for it. “Getting that pool [of investors] together has been really important, and the fact that these investors can now see the opportunity is good for us,” he said.