BG Group today announced that it is disposing of its 60% equity in the Southern North Sea Block 47/15b, containing the Rose gas discovery, to Centrica Resources Ltd, which will also assume the operatorship.

Under the arrangement, Centrica will transfer to BG a 1.5% interest in the BG-operated Armada complex, thus increasing BG's total Armada equity to 46.77%. Centrica will also make a cash payment to BG of £7.32 million.

BG Executive Vice President for the UK Jon Wormley said:

"The exchange of Rose for additional equity in Armada is part of BG's ongoing strategy to rationalise its UK portfolio. The swap will provide value enhancement by consolidating assets in areas that are core to our operations and where we therefore have greater strength. In this sense, it follows the pattern set by the major exchange of North Sea interests we agreed with BP last May"

The disposal of Rose is effective from 1 October 2002, and the acquisition of the new Armada equity from 1 January 2003. The agreement is subject to DTI and partner approval.

Notes to Editors

The Rose field lies in Block 47/15b of the North Sea, 55 kilometres east of the Easington terminal and eight kilometres north-east of the Amethyst field. It was discovered in 1998 by BG with the deviated well 47/10-6. A gas discovery in the "Rose R2" prospect within the same block was announced in July 2001.

BG Group plc -The Integrated Gas Major - works across the spectrum of the gas chain. Active on five continents in some 20 countries, BG operates four business segments - Exploration & Production, LNG, Transmission & Distribution and Power.
BG is a significant holder of hydrocarbon reserves on the UK Continental Shelf, where it operates the Blake, Armada and Easington Catchment Area fields. Internationally, BG's operational strategy is to develop gas markets and construct infrastructure in tandem with its exploration interests. BG's core areas are the UK, Egypt, Kazakhstan, South America, India and Trinidad & Tobago.