Under the agreement, which is subject to pre-emption rights from the existing field partners, Centrica will pay £318.6 million to obtain interests in the Andrew, Brae, Buckland and Skene fields. It will also acquire interests in future exploration opportunities in the licence blocks and a development option which could add significant reserves on the Andrew field.
All the fields have short to medium term production profiles which will benefit from the current high wholesale commodity prices. Approximately 70 per cent of Centrica's equity gas in the fields would be uncontracted and it will also benefit through tariff income from its interest in the SAGE pipeline transporting gas from the Northern North Sea.
Sir Roy Gardner, Chief Executive of Centrica, said: "Today's acquisition underlines our commitment to capitalise on suitable opportunities within the North Sea as part of our wider international strategy to secure future supplies for our British Gas customers
"As the UK becomes a net importer of gas, it is essential that Centrica is able to source gas from a wide and diverse range of options and today's announcement builds on our recent successes in acquiring a 20 per cent equity interest in the Canvey Island LNG project and our existing long term supply agreements with Statoil, Gasunie and Petronas."
Gas from the Brae, Buckland and Skene fields is exported to the St Fergus SAGE terminal, with gas from Andrew delivered to the Teesside terminal via the CATS pipeline system.
Upon expected completion of the agreement in the third quarter of 2005, Centrica will hold the following interests:
Andrew (operator BP) 6.66%
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