Oil and gas entrepreneur Tom Cross has underlined his belief in the potential to develop a successful renewable energy business in Scotland and said he is in the market for acquisitions in the sector.
The North Sea-focused Parkmead Group oil and gas business run by Mr Cross has been working on plans to develop windfarms and the like on Aberdeenshire farmland it acquired in 2019 in an £8.5 million deal.
After Parkmead announced yesterday that it had raised £4m though the sale of land it decided was surplus, Mr Cross said the group had identified a number of possible renewable energy opportunities on its remaining onshore acreage.
Parkmead is developing its plans as a growing number of firms in the North Sea oil and gas supply chain look to move into the emerging renewable energy sector.
News of the land deal came hard on the heels of the UK Government committing to a North Sea Transition Deal that it said would support the “irreversible” shift to cleaner energy.
The Government said the deal would help unlock £16 billion investment in areas such as hydrogen fuel production and carbon capture and storage and support 40,000 jobs.
It decided to allow firms to continue exploring for new oil and gas finds in the North Sea. However, any future licenses will only be granted if they are compatible with the UK’s climate change objectives.
Ministers expect oil and gas to remain part of the energy mix for years.
Exploration activity has fallen to record lows in the North Sea amid the fallout from the coronavirus crisis, which has taken a heavy toll on the supply chain.
However, some firms remain firm believers in the exploration potential of the North Sea.
North Sea-focused Neptune Energy announced yesterday that it had made a significant find in the Norwegian sector.
Private equity-backed Neptune made the Blasto find with Norwegian giant Equinor, which said the discovery could contain up to around 120 million barrels oil equivalent. Equinor has continued investing heavily in North Sea oil and gas projects while also completing significant renewable energy developments.
These include the Hywind floating windfarm off Peterhead, which Equinor reckons is the first of its kind in the world.
Mr Cross achieved renown after using acquisitions to help grow the Dana Petroleum business he ran into one of the biggest independent operators in the North Sea.
Dana was acquired by Korea’s KNOC for £1.9bn in 2010.
Mr Cross joined Parkmead following the takeover of Dana. Under his leadership Parkmead has developed a portfolio of North Sea oil and gas assets. These include oil finds in the Moray Firth, which the company has said could form part of a large development, and producing gas fields off the Netherlands.
In September Parkmead acquired an interest in the undeveloped Fynn Beauly heavy oil find north east of Aberdeen in an offshore licensing round.
Parkmead said yesterday that it had high-graded its renewable energy portfolio through the sale of two separate areas of non-core land following a detailed analysis of its onshore portfolio.
“Parkmead is excited about the potential of its renewables portfolio, “ said Mr Cross.
He added: “Our team continues to carefully evaluate further renewable energy acquisitions that will complement our gas and oil projects.”
Parkmead said it had identified substantial wind energy potential at one location within its portfolio, some 15 miles west of Aberdeen. It said the site has excellent average wind speeds. The site lies close to the Mid Hill Wind Farm, which features 33 turbines.
Shares in Aim market-listed Parkmead closed up 1.5p at 36.8p.
Onshore windfarm developments in Scotland have attracted strong interest from investors in recent months.
The amount firms may have to pay to secure offshore wind licences could increase by ten times, to £100,000 per square kilometre it emerged yesterday. Crown Estate Scotland revised the terms of the key ScotWind leasing round following the huge interest shown by the likes of BP in the latest exercise covering waters off other parts of the UK.
Neptune said Blasto was a strategically important find, which held important resources that could be brought into production quickly.
Neptune is developing the Seagull find 140 miles east of Aberdeen, which it has said will underpin its further growth on the United Kingdom Continental Shelf.
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