THE chief executive of North Sea-focused Serica Energy Tony Craven Walker has said it is easier to make money in the oil and gas industry in a downturn than a boom and highlighted the company’s appetite for acquisitions.

The London-based independent announced that it made its first annual profit since 2009 last year during a period when the crude price slump took a heavy toll on the North Sea as firms slashed spending and jobs.

Serica made $6.5m (£4.5m) profit after tax in 2015.

The downturn has run deeper and lasted longer than many expected and Serica has not been immune from the fall out. The company has written $38m off the value of its portfolio in the last two years.

However, Serica has profited from acquiring a stake in the producing Erskine field east of Aberdeen from BP for around £10m shortly before the crude price started tumbling in 2014.

Serica is making good money from the field even at current depressed prices, leaving Mr Craven Walker keen to cut more deals.

The industry veteran said: “I firmly believe there is more scope to add value at the low end of the cycle than the top end and management’s job is to deliver such opportunities. These may come in the form of improved use of infrastructure, low cost acquisitions or corporate transactions.”

Mr Craven Walker’s comments highlight the fact that lots of North Sea assets have been put up for sale since the crude price peaked at $115 per barrel in June 2014. Some are on offer at much lower prices than during the boom that ended that year.

Serica believes more assets could come on to the market as firms that have been waiting for an upturn accept tough times could last a while yet.

Hopes that major producers including Saudi Arabia would agree a freeze in production to support prices were dashed at the weekend. Brent crude fetched around $44/bbl yesterday.

“The current market and changes taking place in the industry can be expected to present attractive acquisition opportunities as larger players rationalise asset portfolios in an effort to reduce costs and smaller underfunded or overleveraged players are forced to raise funds through asset disposals,” said Mr Craven Walker.

He added: “It is apparent that much of this was deferred last year in the hope of an improvement in commodity prices that did not materialise, adding greater urgency now.”

In January Wood Mackenzie predicted a surge in mergers and acquisition activity in oil and gas markets as “mounting distress” forced many firms to sell assets in areas such as the North Sea.

Aberdeen-based Parkmead Group and Faroe Petroleum have underlined their interest in buying North Sea assets amid current market conditions.

Serica said its priorities for 2016 include building its asset base through acquisition. With around $20m cash and no debts or big spending commitments the company believes it is well placed to take advantage of opportunities.

“We cannot control or even predict near-term commodity prices but believe that finance will be available for the right deals and that Serica’s strong performance places it in a good position to access that finance,” said Mr Craven Walker.

The aim-listed company noted it generated $7.6m cash in 2015 from its 18 per cent stake in Erskine, which produces gas and condensate.

Its share of Erskine production averaged 3,000 barrels oil equivalent daily in the second half of 2015, compared to forecasts of 2,100 boed.

Operating costs were below $20/bbl, against expectations of over $30/bbl.

The price of support services has fallen amid the slump in North Sea activity.

However, Serica has faced challenges. The company wrote $8.2m off the value of exploration assets in the UK and Ireland in 2015. Serica said it has streamlined its exploration portfolio to minimise spending commitments until market conditions improve.

Serica cut its valuation of the undeveloped Columbus field in the North Sea by $17m in 2014 but wrote $5m back last year after increasing its interest through low cost deals with SSE and BG.

The company wrote $12m off Moroccan exploration assets in 2014.

Production from Erskine has been suspended pending the completion of cleaning work on a pipeline, which is taking longer than expected.

Serica generated $24m sales revenues in 2015, all from Erskine.

It lost $36m in 2014.