Former First Oil boss in running for Iona Energy

A former boss at First Oil has emerged as a frontrunner in the race to buy Iona Energy, which folded early last year.

Administrators at FTI Consulting said yesterday that Decipher Energy had entered into a conditional sale and purchase agreement (SPA) for Iona, which holds 75% of the North Sea Orlando and Kells

Decipher director Steve Bowyer used to be managing director of Aberdeenbased First Oil, which was placed in voluntary administration last year.

First Oil had been controlled by multimillionaire businessman Ian Suttie.

FTI said Decipher would pay $1 (80p) for Iona’s shares, but the final bill appears likely to reach sevenfigures due to a complex set licences. of repayments owed to creditors and bondholders.

Administrators said the Decipher deal was “the best option available to maximise recoveries to bondholders and other stakeholders in the company”.

Mr Bowyer was not immediately available for comment.

Previously, Bridge Petroleum had an SPA to buy Iona, but it had to pull the plug on the deal when funding fell through.

In December, the operatorship of Orlando and Kells was handed over to Faroe-based Atlantic Petroleum, which holds 25% of the assets.

The sale of another North Sea field remained in the balance this week after FTI said last month it was “in advanced negotiations with a party” to sell Xcite Energy, which holds 100% of Bentley, one of the North Sea’s largest undeveloped discoveries. On Tuesday, FTI said talks were still advanced and it was working towards “c o ncluding a transaction as soon as possible”.

Xcite got into trouble after issuing £110millionworth of bonds to repay debts and pay for Bentley.

But it was unable to secure extra funds to pay back the bonds, which matured in full on October 31, 2016.

Bondholders rejected a debt-for-equity swap and an application was filed to place the company into liquidation in December.

First Oil had been controlled by multimillionaire Ian Suttie