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Upstream oil and gas firm Lochard Energy Group plc (LSE:LHD) is putting itself up for sale as well as considering a merger, the company said today alongside the release of its unaudited full year results.
The decision was made after discussions with several parties for a farm out deal for its Thunderball and Moby oil and gas discoveries in the North Sea resulted in the Board believing “there would be a higher level of interest were they to seek a buyer for the Company”.
It has been a rough year for the North Sea-focussed oil and gas explorer. Before the financial year ended, Lochard settled a litigation involving its subsidiary, Zeus Petroleum, for US$9 million, a cause of further dissapointment from the group’s previous management team.
Lochard made headlines in the past months when its former Chief Executive, Haydn Gardner, was removed from his post following a petition from one of the firm’s significant shareholders and subsequently suspended trading on the Alternative Investment Market for a week as a result of a management vacuum.
“Rarely does a company have so much to contend with in such a short time,” stated Clive Carver, appointed Non-Executive Chairman following the power struggle.
“Your board’s focus now is to maximise shareholder value, however that may be delivered,” he added.
Athena Oilfield, the company’s flagship asset, commenced production in June and is producing between 10,000 and 11,000 barrels of oil per day, the company stated, 10% of which is net to Lochard.
Lochard Energy Group is the parent company of Lochard Energy (UK) Ltd., which wholly owns Zeus Petroleum Limited, the party to the joint venture to the Athena oilfield holding 10% stake.
Ithaca Energy operates Athena with 22.5% interest and the other partners to the joint venture includes Dyas UK Limited and EWE Energie AG, holding 47.5% and 20% stakes, respectively.
“The difficulties of the past have been quantified and are now behind us,” Chairman Carver declared.
Shares closed 7.3% higher to 7.375 pence.
Company Spotlight
Lochard Energy Group plc is engaged in the oil and gas exploration activities focussing on the UK North Sea through its subsidiary, Zeus Petroleum Limited. The company is headquartered in the UK and its shares are traded on both the Australian and the London Stock Exchanges under the symbol “LHD”.
