Energy sale

SSE offloads gas E&P assets to Viaro for £120m

SSE

SSE is focusing on renewables (pic: Terry Murden)

Energy company SSE is selling its portfolio of gas exploration and production assets to Viaro Energy via its subsidiary RockRose Energy for £120m.

The portfolio comprises non-operational equity shares in more than 15 producing fields in three regions in the North Sea: the Easington Catchment Area, the Bacton Catchment Area, and the Greater Laggan Area.

As part of the transaction, SSE will retain an obligation to pay 60% of the decommissioning costs, payable as the decommissioning of the assets occurs.

SSE has stated for some time that its investment in E&P assets is a non-core activity and ultimately not aligned with its focus on reaching net-zero emissions through renewables businesses.

It plans to invest £7.5 billion in low-carbon energy infrastructure over the next five years and to treble its renewable electricity output by 2030.

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The company has so far secured over £1.4bn from the disposal of non-core assets as part of its £2bn-plus disposal programme by autumn 2021.

Today’s announcement follows recent agreements to sell its share in energy-from-waste venture Multifuel Energy for £995m, its non-operating stake in Walney Offshore Wind Farm for £350m, and its equity interest in meter asset provider MapleCo for £90m.

Gregor Alexander, finance director, said: “We have said for some time that gas exploration and production assets are inconsistent with our future ambitions and vision to be a leading energy company in a net-zero world.

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“This sale clearly comes at a difficult time for the E&P sector, and the economy as a whole, but we believe it is the right move for our shareholders as we focus our resources on our core low-carbon businesses.

“It represents further progress on our strategy to dispose of non-core assets as we look to invest £7.5bn in essential low-carbon energy infrastructure over the next five years, driving the UK’s transition to a net-zero future.”

Bank of America Securities acted as financial adviser to SSE and CMS acted as legal adviser.

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