Centrica plc (LON:CNA) has announced the sale of Spirit Energy Limited’s remaining 15% interest in the Cygnus gas field1, and all other producing assets in the Greater Markham Area2 and Southern North Sea3, to Serica Energy plc.
The total value of the transaction to Spirit Energy is approximately £98 million, including headline consideration of £57 million and the transfer of £41 million of decommissioning liabilities. Centrica’s 69% share of headline consideration is expected to be £39 million. The disposal has a commercial effective date of 1 January 2025 and is expected to complete in the second half of 2026, subject to regulatory approvals and with customary interim period adjustments to be applied.
As with the sale of 46.25% of Spirit’s interest in Cygnus which was completed in early October, this transaction is strongly aligned with Centrica’s focus on maximising value as it continues to reposition its infrastructure portfolio, delivering attractive upfront cash consideration and transferring long-term decommissioning liabilities.
This disposal will result in the Morecambe Hub4 becoming Spirit’s principal producing asset, with total retained reserves of 9.0mmboe5. Spirit’s primary focus will remain on the development of the Morecambe Net Zero6 carbon storage project, alongside safely and efficiently decommissioning its facilities and wells with minimum environmental impact.
Chris O’Shea, Group Chief Executive of Centrica and Chairman of Spirit Energy, said:
“Our focus at Centrica is on creating value. By recycling capital we’re unlocking new investment opportunities in the UK and elsewhere, and accelerating the energy transition – delivering the energy needed today and powering tomorrow’s ambitions by energising a greener, fairer future.
“This disposal generates value for our shareholders, is a significant step in streamlining Centrica’s portfolio, and will focus Spirit on developing the option to invest in Europe’s largest carbon storage project at Morecambe Net Zero. These material UK investment opportunities will however depend upon having a regulatory framework, and a regulator, which is fit for purpose.“
