Aberdeen-headquartered oil player Dana Petroleum has terminated the agreement with NEO Energy for the acquisition of the Western Isles FPSO.
Jersey Oil & Gas, NEO Energy’s partner in the Buchan Horst joint venture, said in a statement that the termination comes after the agreement reached its longstop date at the end of February 2025.
It added that the joint venture’s ability to recommit to the acquisition of the FPSO was linked to the satisfactory conclusion of the ongoing fiscal and regulatory consultations and completion of the required pre-handover works on the vessel.
The JV slowed down its progress on the project after the UK government revealed plans for a consultation on new environmental guidance for oil and gas firms. This became necessary after a UK Supreme Court ruling required regulators to consider the impact of Scope 3 emissions in environmental impact assessments for new projects.
“The fiscal consultation was kicked off yesterday and encouragingly, while the details are yet to be fleshed out, it was apparent that the government has heard many of the concerns of the industry,” Andrew Benitz, CEO of Jersey Oil & Gas
The sale agreement for the FPSO was signed back in 2023 when NEO Energy said it would be taking full control of the unit. At the time of the deal, the company owned a 23% stake in the FPSO. The rest is owned by Dana Petroleum. It was supposed to be deployed to the Greater Buchan Area where the start-up was initially expected for 2026.
Following decommissioning from the Western Isles project, the FPSO arrived at Orkney Harbours in late July last year for wet storage.
