The UK's North Sea Transition Authority (NSTA) has delayed its approval of Viaro Energy's planned acquisition of Deltic Energy, pushing the deal's long-stop closing date from 31 December 2024 to 31 March 2026. The delay stems from the regulator's need for further representations from both companies to address specific concerns, which will determine whether it grants the required change of control for Deltic's licences.

Regulatory and Legal Context

The NSTA's review coincides with Viaro Energy's chief executive facing two active UK court cases involving alleged fraud, which are part of the assessment of the company's suitability to assume operatorship of multiple North Sea fields. This regulatory scrutiny occurs as Viaro has been aggressively expanding its North Sea presence through several acquisitions, including a 2020 deal and a pending transaction to purchase Shell and ExxonMobil’s southern North Sea assets and the Bacton Gas Processing Terminal. The completion of the Shell and Viaro deal, originally expected by the end of this year, is also pending.

Impact on Deltic Energy

The approval delay is a setback for Deltic Energy's shareholders, who had supported the board-recommended £6.9 million takeover as a necessary measure to avoid administration. Despite holding a key stake in the promising Shell-operated Selene gas discovery, Deltic cited the UK's uncertain fiscal and policy environment and a lack of funds to cover its share of development costs up to first gas as primary reasons for endorsing the acquisition by Viaro.