Centrica Acquires Canadian Gas Assets
LONDON -- The shares of Centrica climbed 4 pence to 384 pence during early London trade this morning after the FTSE 100 member announced the purchase of a package of natural gas fields in Canada.
Centrica, which operates six gas-fired power stations in England and Wales and supplies gas to 12 million households, said the assets would be held through a joint venture with Qatar International Petroleum.
The deal will cost a total of £650 million, with Centrica holding 60% of the assets and Qatar Petroleum the remaining 40%. The gas fields, which are located within Alberta and British Columbia, will be operated by Centrica. The company said the fields contained proven and probable gas reserves measuring 978 billion cubic feet.
Centrica also claimed the deal included more than 1 million acres of undeveloped land and "significant potential for reserves and production upside through the use of horizontal drilling and multi-stage fracturing."
Sam Laidlaw, Centrica's chief executive, said: "The acquisition provides attractive returns in a region we know well, and significantly increases the size and quality of our portfolio. It also presents exciting development opportunities, with the potential to improve returns further."
Nasser Al-Jaidah, the chief executive of QPI, said: "This investment in the Western Canadian Sedimentary Basin is a significant step in the development of QPI's global upstream business. We look forward to continuing to advance QP's overall North American energy business through the Memorandum of Understanding and other initiatives."
Based on the group's 2012 results, Centrica's shares currently trade at 14 times profits and yield a 4.3% dividend income.
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