IGas to Acquire Nexen's Onshore Interests

IGas Energy Plc. signed an agreement signing of an agreement with Nexen Petroleum U.K. to acquire its Nexen Exploration U.K. unit.

As a result, IGas Group will become the operator and sole owner of each of its licences, increasing its Contingent Recoverable Resource 2C (P50) wby 115% to 1,736bcf or 290 million barrels of oil equivalent and its current production will almost triple.

In exchange Nexen will receive IGas shares equivalent to 29.9% of the enlarged issued share capita and will have the right to be represented on the board of IGas by one director.

The Agreement will also give IGas on-going access to Nexen's unconventional gas technology, including the secondment of key personnel.

Andrew Austin, CEO, of IGas said: 'This accretive acquisition marks a major turning point in our history. IGas is more than doubling its Contingent Recoverable Resources, with a consequential effect on future production. As a result of this deal we will have enough recoverable gas to supply electricity to 15% of UK homes for 15 years.

Additionally, as operator of all our acreage, we will be able to accelerate our production plans and increase our ability to deliver gas. This landmark deal brings significant value not only to IGas' existing shareholders but also to Nexen, as its onshore UK gas interests will now be held in a company dedicated to delivering secure gas onshore.

Nexen has been a great partner in the appraisal and pilot production phases of the development of our assets and we now look forward to having them as shareholders as we move to full field development. We remain funded for our existing plans including the delivery of our first commercial production site in 2011.'

IGas is a domestic gas producer and leading developer of unconventional gas resources in the UK.

Read More on IGas Plc.  HERE