Agreement with Faroe Petroleu

RNS Number : 4872W

Scottish & Southern Energy PLC

19 November 2010

 



SCOTTISH AND SOUTHERN ENERGY PLC

AGREEMENT WITH FAROE PETROLEUM PLC

SSE (Scottish and Southern Energy plc) has entered into an agreement with Faroe Petroleum plc, the independent oil and gas company,  to work together to identify, assess and, where good value can be obtained, acquire producing oil and gas assets in the North Sea.

It has also subscribed in a placing for just over 5% of the enlarged share capital of Faroe Petroleum plc at a cost of around £18m.

SSE is working towards final completion on the acquisition of its first North Sea gas production assets, from Hess Limited, later this year.  The new SSE/Faroe  partnership is currently working on a number of opportunities to acquire upstream production.

Alistair Phillips-Davies, Energy Supply Director of SSE, said:

"Our goal is to build up a presence in the upstream gas sector in a measured way to provide an additional source of primary fuel and a hedge for our gas generation and supply activities.  This agreement with Faroe Petroleum, which has a strong track record and team, should help us to achieve that over the medium term."

Graham Stewart, Chief Executive of Faroe Petroleum plc, commented:

"The agreement with SSE is an important step forward for Faroe, as we pursue our strategy of growing production revenues to support our extensive exploration activities. The partnership's combined expertise and relationships across the market, provide a unique opportunity to acquire high quality oil and gas production and benefiting from respective strengths."

 

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