Increase in Equity Holding of Upstream Gas Assets

RNS Number : 0522R

SSE PLC

14 November 2012

 



SSE PLC

INCREASE IN EQUITY HOLDING OF UPSTREAM GAS ASSETS

SSE, through its wholly-owned subsidiary SSE E&P UK Limited, has entered into an agreement with Perenco to increase its equity stake in three producing gas fields in the Southern North Sea - Apollo, Minerva and Mercury. SSE will pay a total cash consideration of US$52.75m (£33m). 

SSE currently has a 35% equity interest in Apollo and Minerva, and a 26.67% equity interest in Mercury.  As a result of this deal SSE's equity interest in all three fields will increase to 50%.  Following Perenco's recent acquisition of a larger package of assets from BP in the Southern North Sea, they will hold the remaining 50% equity in the fields and become the Operator. 

Net to SSE, on a proven and probable (2P) basis, the deal will increase SSE's producing gas reserves by over 200 million therms over the life of the fields.

The transaction is expected to be completed by the end of the year.

David Franklin, Managing Director Energy Portfolio Management, said:

"Our decision to increase our equity stake in Apollo, Minerva and Mercury, reflects SSE's growing confidence and expertise in owning producing gas assets. These fields have performed well since we acquired them in 2011 and in Perenco we have an experienced owner and Operator as a partner.

"SSE's upstream gas assets provide a good source of primary fuel and a hedge for our gas generation and supply activities, and we are therefore proactively seeking new opportunities to increase our presence in this sector where assets can be acquired for a fair price."

 

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