Centrica in $388m Total North Sea grab

Total selling: Christophe de Margerie-led French player hives off North Sea assets to Centrica

Centrica has splashed out $388 million on a raft of central North Sea assets from Total just days after an executive at the French supermajor revealed it was in talks on a deal.

The all-cash deal will see the UK gas giant take over seven producing non-operated fields from Total in three major areas: Greater Armada, the Alba field and the Mungo and Monan cluster.

With the purchase, Centrica is increasing its reserves by around 5% as the company's share in the assets equates to around 22 million barrels of oil equivalent of proven and probable resources. This is made up of 36% gas and 64% oil, Centrica said. The assets are expected to produce 9300 boe per day in 2012.

In the Greater Armada area, Centrica is taking Total's 28.96% stake in the Maria field to move its holding to 64%; a further 25% in Seymour to move to 43%; another 12.53% in Armada Unit to take it to 23.58%; and 0.69% in Everest where is is currently not active. All four fields are operated by BG.

In Alba Centrica is taking a maiden 12.65% stake in the Chevron-operated field and Mungo and Monan it is getting 12.43% in the BP-operated field where it currently has no interest.

Centrica is also getting a small interest in BP-operated associated infrastructure.

The deal is subject to approval from the UK government with closing not expected before July. Around 20% of the price tag has been earmarked for UK tax.

Centrica managing director Mark Hanafin commented: "This acquisition in the North Sea provides a good fit with our existing portfolio and strategy...It underlines our commitment to invest where we see attractive opportunities, securing future energy supplies for the UK."

On Tuesday Upstream reported that Total was readying the sale of certain non-operated assets in the UK. Patrice de Vivies, head of the supermajor’s northern Europe business, described the interested buyer as a "well-known company".

De Vivies had said the sales covered Total’s minority interests in BG's Armada, Maria, Seymour and Everest fields, in BP’s Mungo, Monan and Etap fields plus Chevron’s in the Alba field.

After receiving 15 offers, de Vivies said: “We are in exclusive and final negotiations with one buyer ... a well-known company.”


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