Under the agreement with private British oil company Acorn Oil& Gas Co (AOG), if development drilling and other results are positive, Roc will convert its option to buy a stake in or before May 2005.

Roc chief executive John Doran said the unusual deal may initially appear complex.

"In reality, all that has happened is that, because of Roc's extensive industry network, flat management structure and strong balance sheet, it has been able to move quickly on a short-fused production acquisition deal which offered terms not often encountered in a world of $US40 per barrel oil prices," Doran said.

"Whether or not it turns out to be a good move will only become apparent as the development drilling and workover program unfolds during 2005."

AOG subsidiary, Acorn North Sea Ltd (ANSL), currently holds a 35% share of the assets being sought by Roc.

Under the deal, Roc is buying the right to buy into the acreage by investing 750,000 pounds via a secured senior ranking loan provided to ANSL and undertaking to pay 26% of future joint venture cash calls.

It has also agreed to pay what would amount to an option exercise fee of up to 1.9m pounds if Roc decides to go ahead and take a stake in the block.

Previously known as the Argyll Field, Ardmore became the first UK North Sea field to pump oil in 1975 but was abandoned after 17 years, partly because of constraints on facilities.

The recently redeveloped field is currently operated by 65 per cent owner, Tuscan Energy (Scotland) Ltd.

“The potential of the area immediately around the Ardmore field is intriguing,” Doran said.

A nearby rig provided useful infrastructure, while two abandoned oil fields, a single-well oil discovery and several undrilled prospects and leads provided promising opportunities, the company said.