UK's Centrica Launches Sale of Upstream Arm: Press

UK energy group Centrica has formally launched the process of selling its 69% stake in North Sea-focused producer Spirit Energy, Reuters reported on November 11 citing documents sent to potential buyers.

Centrica announced in July its intention to sell its equity position in the upstream firm by the end of 2020 to help pay off its debts and shift its focus from fossil fuels to consumer energy services. Spirit currently produces around 130,000 barrels of oil equivalent/day, though its output is set to slide to 100,000 boe/day by 2025, the documents stated. But it still has 270mn boe in proven and probable reserves.

The company is also debt-free, boasting £894mn ($1.14bn) in operating cash flow last year, according to the documents.

Spirit’s other owner, Germany’s Stadtwerke Muenchen (SWM), will also “evaluate proposals” for its 31% stake, Reuters reported.

The producer was formed when Centrica merged its upstream operations with the UK, Danish, Dutch and Norwegian oil and gas assets of Germany’s Bayerngas in 2017.