Grangemouth refinery operator Ineos said it agreed to take a majority share in two exploration licenses in the Northern Gas Fields West of Shetland — which contain the significant Lyon prospect — from Siccar Point Energy E&P Limited.

“The deal complements the significant Ineos portfolio of producing assets and discoveries West of Shetland, recently acquired from Dong E&P,” said Ineos.

“Completion of the transaction remains subject to customary regulatory consents.

“A significant opportunity now exists for Ineos to unlock gas from the most northerly licenced area of the UKCS, 150 km north of the Shetland Islands.

“In particular Lyon, a material prospect that is thought to contain of 1-3 trillion cubic feet recoverable gas.

“If successful it could be large enough to form a new gas-hub development similar to the Laggan-Tormore fields, which have been developed with sub-sea infrastructure and pipelines to the Shetland Gas Plant.

“Existing gas discoveries in the Lyon area such as Tobermory, Bunnehaven and Cragganmore would all be suitable tie-back candidates into a Lyon gas hub.”

Ineos Oil & Gas CEO Geir Tuft said: “Ineos intends to become a significant player in this area.

“This deal confirms our aim to take a leading role to develop the Northern Gas Fields using the significant infrastructure investments already made West of Shetland.”

“With the purchase of the Dong E&P business earlier in the year, Ineos took over a significant portfolio of producing assets and discoveries West of Shetland.

“It is clear that the Northern Gas Area holds  further opportunities that could help unlock the development of those discoveries. The deal with Siccar compliments our assets.”