Belfast Telegraph

Centrica launches exploration and production firm Spirit Energy

Under the terms of the deal with Bayerngas Norge, Centrica will hold 69% in the new company and Bayerngas will have 31%.

British Gas owner Centrica has launched its European oil and gas exploration and production (E&P)  joint venture, dubbed Spirit Energy.

Under the terms of the deal with Bayerngas Norge, Centrica will hold 69% in the new company and Bayerngas will have 31%.

The new entity will contain Centrica’s assets in the UK, Netherlands and Norway and Bayerngas Norge’s in Norway, the UK and Denmark.

Production for 2017 is expected to be around 50 million barrels of oil from 27 fields, Centrica said.

Spirit Energy, which employs 700 people, will invest between £400 million and £600 million per year and is expected to deliver between 45 million and 55 million barrels of oil in the medium term.

The deal is also expected to generate up to £150 million of cost savings.

Centrica boss Iain Conn said: “With the creation of Spirit Energy, we have now completed the first phase of our portfolio transformation as we reallocate resources towards our customer-facing businesses, leaving Centrica well-positioned to deliver longer-term returns and growth.

“As one of the largest independent E&P companies in north-west Europe, Spirit Energy will have the possibility to participate in further consolidation and joint ventures, and creates further optionality for Centrica’s shareholders.”

Popular