Spirit Energy Sells 46.25% Interest in Cygnus Gas Field to Ithaca Energy as Part of Long-Term Energy Transition Strategy

Spirit Energy Sells 46.25% Interest in Cygnus Gas Field to Ithaca Energy as Part of Long-Term Energy Transition Strategy

(IN BRIEF) Centrica plc has finalized an agreement for Spirit Energy to sell a 46.25% stake in the Cygnus gas field to Ithaca Energy for £215 million. The sale includes £116 million in headline consideration and £99 million in decommissioning liabilities. Cygnus, located in the Southern North Sea, is co-owned by Spirit Energy (61.25%) and Ithaca Energy (38.75%). Following the transaction, Spirit will retain a 15% interest in the field. Spirit’s 2P reserves at Cygnus will be reduced by 19.4mmboe, and production from the remaining share is expected to reach 6mmboe in 2025. This transaction aligns with Centrica’s ongoing strategy to reduce its gas production exposure and refocus efforts on long-term projects like the Morecambe Net Zero carbon storage project.

(PRESS RELEASE) WINDSOR, 20-May-2025 — /EuropaWire/ — Centrica plc has confirmed that Spirit Energy Limited, its subsidiary, has entered into an agreement to sell a 46.25% interest in the Cygnus gas field to a subsidiary of Ithaca Energy plc. This transaction, valued at approximately £215 million, includes £116 million in headline consideration and £99 million worth of decommissioning liabilities. Centrica’s 69% share of the headline consideration is expected to amount to £80 million.

The Cygnus gas field is located in the Southern North Sea, around 150 kilometers east of the Lincolnshire coast. It is jointly owned by Spirit Energy (61.25%) and Ithaca Energy (38.75%), with Ithaca Energy acting as the operator. Upon completion of the transaction, Spirit Energy will retain a 15% interest in the field. As of the end of 2024, Spirit Energy’s 2P reserves at Cygnus stood at approximately 25.7mmboe, comprising 1,509mmth of gas and 0.5mmboe of NGLs. In 2024, Cygnus produced around 6.9mmboe (399mmth of gas and 0.1mmboe of NGLs). The 46.25% stake being sold represents 19.4mmboe in 2P reserves (1,139mmth of gas and 0.4mmboe of NGLs), with expected production in 2024 of 5.2mmboe (301mmth of gas and 0.1mmboe of NGLs). Following the completion of the transaction, Spirit Energy’s remaining 61.25% interest in Cygnus is expected to produce approximately 6mmboe in 2025, with 98% of that being gas. The sold 46.25% interest is expected to contribute approximately 4.5mmboe.

The deal has a commercial effective date of January 1, 2025, and is scheduled for completion during the second half of 2025, subject to customary interim adjustments.

This divestment is in line with Centrica and Spirit Energy’s strategy to maximize value from Spirit’s remaining assets. It provides an immediate cash inflow and transfers long-term liabilities, allowing the company to shift its focus toward long-term projects such as the Morecambe Net Zero carbon storage initiative. Ithaca Energy, already a shareholder and operator of Cygnus, is well-positioned to assume majority ownership of the asset.

Following the transaction’s completion, Spirit Energy will remain focused on the development of the Morecambe Net Zero carbon storage project, which aims to repurpose the depleted South and North Morecambe gas fields off the coast of Barrow-in-Furness into a world-leading carbon storage facility capable of storing up to 1 gigaton of CO2 over its lifetime. This is equivalent to three years’ worth of CO2 emissions from the UK.

Chris O’Shea, Group Chief Executive of Centrica and Chairman of Spirit Energy, stated, “This sale is an important step in our strategy to reduce our exposure to gas production while continuing to deliver value to our shareholders. The proceeds will allow Spirit Energy to focus on the significant opportunity presented by the Morecambe Net Zero carbon storage project, which will help address the UK’s carbon reduction targets.”

Notes to Editors

1.     Cygnus is located in the Southern North Sea, approximately 150km east of the Lincolnshire coast. Cygnus is jointly owned by Spirit Energy (61.25%) and Ithaca Energy plc, through its subsidiary Eni UK (38.75%); Ithaca Energy is the operator. Following completion of the transaction, Spirit Energy will retain a 15.00% interest in the field. At the end of 2024, Spirit had 2P reserves at the field of approximately 25.7mmboe (1,509mmth of gas, 0.5mmboe of NGLs) and produced approximately 6.9mmboe (399mmth of gas, 0.1mmboe of NGLs) in 2024. 2P reserves associated with the 46.25% stake are approximately 19.4mmboe (1,139mmth of gas and 0.4mmboe of NGLs), with 2024 production approximately 5.2mmboe (301mmth of gas, 0.1mmboe of NGLs). 2025 production from Spirit Energy’s 61.25% share in Cygnus is expected to be approximately 6mmboe (of which approximately 98% is gas); 46.25% share approximately 4.5mmboe.

2.     The Morecambe Net Zero carbon storage project aims to repurpose the depleted South and North Morecambe gas fields off the coast of Barrow-in-Furness into a world-leading carbon storage facility, able to accept up to 1 gigaton of CO2 in its lifetime, the equivalent of three years’ worth of UK CO2 emissions.

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SOURCE: Centrica plc