Sovereign Oilfield Group enters administration

Sovereign Oilfield Group, which supplies technical resources and engineering to the oil and gas industry, has entered administration, following failed talks with its lenders to renegotiate the terms of its debt.

The company, based in Aberdeen, has approximately 400 employees, located mainly in the north east of Scotland. It is said to be struggling with debts in excess of £30m.

Its shares were listed on the Alternative Investment Market in 2005 and were suspended from trading yesterday.

Sovereign Oilfield Group also operates nine subsidiary companies, selling drilling tools and other equipment to the oil and gas sector. The subsidiaries are not in administration.

PricewaterhouseCoopers has been appointed as administrator and has said that it would investigate selling the company's subsidiary's where possible, through sales of shares or assets.

Bruce Cartwright, from PricewaterhouseCoopers in Scotland commented: "While the group position has become financially unsustainable, we are hopeful that potential buyers will recognise the inherent quality within some of the trading entities."

The chairman and chief executive, of Sovereign Oilfield Group, Graham Burgess, and its finance director, Julie Cowie, both resigned at the end of last year.

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