Scottish and Southern Energy to acquire North Sea gas assets of Hess for £278 million
03 Apr 2010
British energy company Scottish and Southern Energy plc (SSE) has agreed to acquire the North Sea natural gas and infrastructure assets of US energy firm Hess Corporation for £278 million.
Perth, Scotland-based SSE said on Wednesday that it has proposed to acquire the natural gas assets and infrastructure in three regions of the North Sea, Everest/Lomond Area; Easington Catchment Area; and Bacton Area.
SSE, the UK's second largest energy supplier, currently needs on average around 1,300 million cubic feet (mcf) of gas per day to supply its customers and to fuel its power stations, and gas from the proposed acquisition, will provide around 8 per cent of that initially, but more gas could be found through further exploration.
SSE will get through the acquisition, where the lead operators of the upstream assets are BG Group, BP and Perenco, around 383 billion cubic feet or 64 million barrels of oil equivalent.
Although most of the proposed acquisition is the upstream gas assets, SSE will also acquire a number of other assets from Hess, including its 17.7 per cent equity interest in the Central Area Transmission System pipeline operated by BP, which delivers over 10 per cent of the UK's total gas demand through a 400km pipeline from the central North Sea to a processing terminal in Teesside.
Ian Marchant, chief executive of SSE, said: "This timely acquisition will enable SSE to enter the upstream gas sector in a measured way by buying proven and geographically diverse production assets."
