Centrica, StatoilHydro and CCC agree Memorandum of Understanding for Nigerian LNG consortium

Wednesday, November 7, 2007

Centrica plc, the parent company of British Gas, StatoilHydro ASA (Statoil ASA), and Consolidated Contractors Company ("CCC") have signed a Memorandum of Understanding ("MOU") for participation in a consortium to assess the feasibility of developing LNG projects in Nigeria.

The agreement, for an initial eighteen month period with an option to extend, would see Centrica and StatoilHydro each taking a 37.5 per cent interest in the consortium, with CCC holding 25 per cent. The feasibility study cost is expected to be about $10 million (USD) and will include analysis of potential feed gas, LNG plant locations including local infrastructure and end markets.

Centrica, which holds two exploration licences in Nigeria, is broadening its search for new sources of gas to supply its British Gas, European and North American customers. Its current Nigerian work programme will see exploratory wells in its offshore/onshore block 276 commence in 2008.

StatoilHydro in Nigeria is currently operator for two deepwater licenses, OMLs 128 and 129, in which OML 129 contains the Nnwa gas discovery. StatoilHydro ASA (Statoil ASA) is also partner in five other deepwater licenses including the Agbami oil field. StatoilHydro ASA is a major gas player and Nigeria is an important element in its overall gas strategy.

CCC has participated in the development of a range of major international oil and gas infrastructure projects including petrochemical and LNG facilities.

Sam Laidlaw, Chief Executive of Centrica, said: "As part of our broader search for new sources of gas to supply our customers, this agreement provides us with an option to assess the viability of developing LNG projects in Nigeria, working alongside experienced partners."

Helge Haland, Country Manager for StatoilHydro in Nigeria, said: "The consortium members bring a range of complimentary areas of expertise and resources to this project at a pivotal stage in the development of Nigeria's gas strategy. We look forward to working with key stakeholders and are committed to contributing to the government's ambitions to develop Nigeria into a major gas producer".

Marwan Salloum, Vice President of CCC said: "CCC is proud to be associated with this project not only because of the calibre and experience of its co-sponsors but also for the potential value it sees for Nigeria, in terms of the much needed internal infrastructure development that may be associated with the LNG project."

This article is for information and discussion purposes only and does not form a recommendation to invest or otherwise. The value of an investment may fall. The investments referred to in this article may not be suitable for all investors, and if in doubt, an investor should seek advice from a qualified investment adviser. More

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