Photo: llustration. Source: Premier Oil

Premier Oil and Chrysaor formally become Harbour Energy

The completion of the all-share merger of Chrysaor and Premier Oil has formally been completed and the company, named Harbour Energy, will be admitted to trading on the London Stock Exchange from 1 April 2021.

To remind, all the regulatory conditions relating to Premier Oil’s merger with Chrysaor were satisfied in late February. At the time, the companies received all the requisite antitrust approvals for the merger.

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In a statement on Thursday, Harbour Energy described itself as “a global independent oil and gas company, producing over 200,000 barrels of oil equivalent per day from the North Sea and South East Asia”.

According to the company, the merged company has a strong balance sheet and the financial flexibility to fund both further growth and shareholder returns, including via a sustainable dividend in the near-term.

[Harbour Energy] has a broad set of international growth opportunities, including an attractive development and exploration portfolio and a management team with a track record of value creation through disciplined M&A transactions”.

It also stated that it has a lower carbon intensity than the average UK oil and gas producer with a commitment to achieve net-zero greenhouse gas emissions by 2035.

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Harbour will be governed by a board comprising 11 directors which will be chaired by Blair Thomas, the current CEO of EIG while Linda Cook will be the company’s CEO. Phil Kirk fills the role of the company’s president and CEO of Europe and Alexander Krane will be appointed as its CFO on 15 April.

Harbour also provided its guidance for 2021, both on a proforma basis (including 12 months of Chrysaor and Premier) and a reported basis (including 12 months of Chrysaor and 9 months of Premier).

Both proforma and reported guidance is consistent with that provided by Premier and Chrysaor on 18 March 2021.

According to the statement, proforma production stands at 200-215 kboepd while reported production will be 185-200 kboepd while proforma and reported operating costs, excluding lease costs, will be less than $15/boe.

Proforma and reported total capital expenditure, including production, development, exploration, and decommissioning pre-tax will be around $1.1 billion. The company’s free cash flow breakeven will be $30-$35/boe and net debt is around $2.9 billion at completion with significant current liquidity of more than $700 million.

Linda Cook said: “This is a landmark day for Harbour Energy and all of those involved with Premier and Chrysaor. As the largest UK-listed independent oil and gas company, Harbour offers a unique opportunity for investors, bringing together two complementary portfolios with a material North Sea foundation, an attractive global footprint and a strong balance sheet.

I would like to thank everyone in both Premier and Chrysaor for their tremendous efforts in completing the transaction. Today, as we start our future as Harbour Energy, we look forward to realising the potential of our new company for all of our stakeholders”.

It is worth reminding that Premier reached an agreement with Harbour’s UK operating company Chrysaor regarding a proposed all-share merger between Premier and Chrysaor and the reorganisation of Premier’s existing debt and cross-currency swaps in early October 2020.

In December 2020, the name Harbour Energy was chosen while shareholder approval for the transaction was received in January 2021 as well as Vietnam antitrust approval.