Breaking News

Tweet TWEET

CNA: Centrica plc: Acquisition

  CNA: Centrica plc: Acquisition

UK Regulatory Announcement

LONDON

Centrica acquires a 25% interest in UK shale exploration licence

Centrica plc has acquired a 25% interest in the Bowland exploration licence
(PEDL165) in Lancashire from Cuadrilla Resources Ltd (Cuadrilla) and AJ Lucas
for £40 million in cash. Centrica will also pay exploration and appraisal
costs of up to £60 million.

The Bowland licence is operated by Cuadrilla, and three exploration wells have
been drilled to date. The data obtained from drilling these three wells has
confirmed the shale formation thickness and the presence of natural gas.

Although initial data suggests that there could be 200 trillion cubic feet
(tcf) of gas in place within Cuadrilla’s Bowland Shale licence in Lancashire,
further drilling will be required to establish whether the discovery is
commercial.

Mark Hanafin, Managing Director of Centrica’s International Upstream business,
said: “With North Sea gas reserves declining and the UK becoming more
dependent on imported gas supplies, it is important that we look for
opportunities to develop domestic gas resources, to provide affordable sources
of gas to our customers, and to deliver broader economic benefits to the UK.

“The Government’s clear commitment to developing the UK’s shale gas industry
is creating the right environment for companies to invest and to deliver those
benefits.

“This transaction presents an attractive opportunity for Centrica to explore
the potential and commercial viability of natural gas from shale in the UK,
while utilising its expertise as a responsible operator and developer of UK
gas resources.”

Ends

Notes to Editors

1. Under the agreement, Centrica has acquired two subsidiary entities for
consideration of £40million, one each from Cuadrilla and AJ Lucas, in total
containing a 25% interest in the Bowland exploration licence (PEDL165).
Centrica will then pay exploration and appraisal costs of up to £60million.

2. Following the exploration and appraisal phase, if Centrica elects to
continue into the development phase a further contingent consideration of £60
million will become payable.

3. It is estimated that natural gas from shale could reduce the amount of gas
the UK has to import in 2030 from 76% to 37%. Nationwide investment could
reach £3.7bn a year, supporting 74,000 jobs across the industry and its supply
chain (source: IoD Getting Shale Gas Working, 2013).

4. AJ Lucas is an Australian specialist service provider to the energy, mining
and infrastructure sectors.

Contacts

Centrica Investor Relations: +44 (0)1753 494900

Centrica Media Relations: Alan McLaughlin +44 (0)7789 570598 / Julian Mears
+44 (0)7789 576179

Contact:

Centrica plc
 
Press spacebar to pause and continue. Press esc to stop.