Centrica to Participate in North Sea Exploration
Centrica PLC
July 15, 2005
Centrica to participate in North Sea exploration licence
Centrica plc today announced it has reached an agreement with Wham Energy
Limited ('Wham') and Endeavour Energy Limited ('Endeavour') which will result in
a 40 per cent equity ownership of licence P1132 in the Southern North Sea,
including participating in an exploration well to be drilled in the third
quarter of 2005. This licence covers blocks 42/12 and 42/22 which Centrica is
farming into.
Under the agreement, Wham has agreed to farm out half of its 40 per cent equity
in these licence blocks to Centrica, in consideration of Centrica drilling an
exploration well in the third quarter. Similarly, Centrica will acquire 20 per
cent equity from Endeavour. Subject to all agreed drilling conditions being met,
Centrica would hold 40 per cent equity in the licence. The expected cost to
Centrica would be approximately £5.5 million.
The agreement is Centrica's first investment in an exploration prospect outside
of its own existing equity infrastructure. Within its future gas sourcing
strategy it intends to consider a limited number of targeted future exploration
opportunities, largely through partnership activities close to current producing
fields, alongside equity investments, contractual agreements and traded market
purchases.
Sir Roy Gardner, Chief Executive of Centrica, said: 'This agreement is one of a
limited number of exploration wells that Centrica expects to consider in the
future, as we focus on a range of opportunities to add reserves to our
portfolio.
'The current high wholesale price of gas makes increased exploration activity an
attractive option. Our intention is to work alongside partners and consider
prospects close to producing assets within the UK, Norwegian or Dutch sectors.'
Note to editors:
1/ Following conclusion of the exploration well, the equity share in the P1132
licence would be:
Centrica 40%
Endeavour 22.5%
Wham 20%
Antrim 17.5%
Enquiries:
Centrica Investor Relations 01753 494900
Centrica Media Relations 01753 494085
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