Centrica is set to divest a substantial portion of its interest in the Cygnus gas field located in the southern North Sea.
The transaction will involve Spirit Energy, a Centrica subsidiary, selling its 46.25% stake in the field to Ithaca Energy for approximately £215 million, as reported by City AM.
Centrica, the owner of British Gas, stated that the sale is consistent with its strategy to “maximise value from Spirit’s remaining reserves” and secure an “attractive upfront cash consideration.”
Cygnus stands as one of the UK’s most significant gas fields within the North Sea sector, contributing to around six percent of the nation’s gas demand during peak periods.
The field was previously under joint ownership between Spirit Energy and Ithaca, through Ithaca’s subsidiary Eni UK.
Chris O’Shea, Centrica’s chief executive and chairman of Spirit Energy, remarked on the deal: “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.”
Following the announcement, Centrica’s shares experienced a near two percent uplift in early trading.
‘The type of deals we like’
Yaniv Friedman, Ithaca’s executive chairman, expressed enthusiasm about the acquisition: “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 anticipated to reach completion in the second half of 2025, following a customary interim period typical of such transactions.
