Centrica has announced plans to sell off a big chunk of its holding in the Cygnus gas field in the southern North Sea.
The deal will see Spirit Energy – a subsidiary of Centrica – offload its 46.25 per cent stake in the site for around £215m to Ithaca Energy.
Centrica, which owns British Gas, said the transaction aligned with its strategy to “maximise value from Spirit’s remaining reserves” and deliver an “attractive upfront cash consideration.”
Cygnus is one of the largest gas fields in the UK section of the North Sea, supplying approximately six per cent of the country’s gas demand at peak times.
It was already jointly owned by Spirit Energy and Ithaca, via its subsidiary Eni UK.
“Through this disposal we are taking another step in reducing our exposure to gas production while accelerating the delivery of enhanced value to shareholders, allowing the Spirit team to further focus on delivering the largest carbon storage project in Europe,” Centrica’s chief executive and chairman of Spirit Energy, Chris O’Shea, said.
Shares in Centrica rose nearly two per cent in early deals.
Yaniv Friedman, executive chairman of Ithaca, said: “Today’s transaction with Spirit Energy provides further equity in a high-margin, high-quality producing gas asset that we understand deeply through our operatorship.”
“By increasing our stake in Cygnus we add incremental reserves and production to our portfolio at attractive valuation metrics that ticks all of our investment criteria, without adding any complexity. We also see significant upside potential through further infill drilling beyond the next three approved wells.
“This is the type of deals we like.”
The disposal is expected to be completed in the second half of 2025 per a standard interim period in such deals.
By City AM
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