BG International Ltd (a subsidiary of BG Group plc) has today completed an agreement to assign to EDF Trading Ltd, with effect from April 24 2001, its interest and obligations in two gas sales agreements with Wingas GmbH of Germany, together with the relevant transportation capacity in the UK/Belgium Interconnector and Distrigaz of Belgium's transit system. BG has also entered into arrangements for the supply of gas to EDF Trading, and has agreed to pay EDF Trading £184 million in cash, which is fully covered by a provision.

The agreement means that BG is able to discharge its responsibilities in economical terms which are mutually beneficial to BG and other parties.

The gas sales agreements, signed in 1996, are contracted to sell around 20 billion cubic metres of gas over 10 years to Wingas. Deliveries began in 1998, when the UK/Belgium Interconnector began operations. The contracts were forecast to give rise to future losses, and were fully provided for at the time of the Centrica demerger in 1997.

BG intends to retain sufficient Interconnector capacity to maintain flexibility for trading its UK gas, and to take advantage of the development of gas trading around Zeebrugge.

EDF Trading is a joint venture between Electricite de France and Louis Dreyfus. Wingas GmbH is a joint venture between Wintershall AG and Gazprom.

Note to editors

The Wingas sales agreements were signed in July 1996 by British Gas Trading Ltd. These were assigned to BG plc at the time of the Centrica demerger in 1997 and subsequently to BG International Ltd prior to the Lattice demerger in 2000.