New North Sea-focused independent Spirit Energy, owned jointly by Centrica and Bayerngas Norge, has launched.
Spirit Energy combined Centrica’s E&P business with Bayerngas Norge, under a deal announced in July this year.
Spirit Energy has operated and non-operated interests across the UK, Norway, the Netherlands and Denmark, with 27 producing fields and more than 70 exploration licenses.
The firm is owned 69% by Centrica and 31% by Bayerngas Norge’s former shareholders, led by Stadtwerke München Group (SWM). 2017 production from the combined portfolios is expected to be around 50 MMboe from 27 producing fields. Total 2016 year end 2P reserves and 2C resources were 625 MMboe.
A statement from Centrica said that the company will invest £400-£600 million a year "to deliver sustainable medium-term production of 45-55 MMboe."
Centrica says that Spirit Energy’s focus in 2018 will be to maximize efficiency from its producing assets, as well as progressing several key projects including the developments of Maria and Oda, appraisal drilling at the Fogelberg discovery and drilling on a number of exploration prospects. Spirit Energy will also partner with Wintershall in submitting a plan for development and operation for the Skarfjell development.
Employing more than 700 people, Spirit is headquartered in the UK, with offices in Windsor, Aberdeen and Sevenoaks in the UK; Oslo and Stavanger in Norway; Hoofddorp in the Netherlands, and Copenhagen in Denmark. The business also owns and operates the Barrow Gas Terminals in the UK.
The transaction is expected to generate £100-£150 million net present value of "synergies," and the joint venture will have the opportunity to strengthen through further consolidation and joint ventures, says Spirit.
Iain Conn, group CEO for Centrica, said: "As one of the largest independent E&P companies in North-West Europe, Spirit Energy will have the possibility to participate in further consolidation and joint ventures."
Chris Cox, CEO of Spirit Energy, will be joined on the Spirit Energy management team by Andrew le Poidevin as Chief Financial Officer and Gerry Harrison as Chief of Staff. Spirit Energy’s board will be made up of Chris Cox, plus four appointees from Centrica and two from Stadtwerke München. It will be chaired by Centrica’s Group Executive Director Mark Hanafin.
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