Thames pipeline17 Apr 2018 14:13
The acquisitions of 50% of Blythe and 100% of the Vulcan Satellites in 2016 were landmarks in the evolution of the Group. While relatively small, the Blythe transaction was strategically critical, giving us 100% ownership, operatorship and control of the full hub area. This position was then enhanced significantly with the addition of 100% ownership of the three Vulcan Satellite fields to the east. By negotiating to acquire the Thames pipeline post year-end at nominal cost alongside these two deals we have created an economically robust, high-margin dual gas-hub project in familiar UK waters, with a viable potential exit route and without resorting to expensive and risky exploration.
The Thames pipeline acquisition, then, is the key that unlocks our low-risk development and production strategy. In the SNS we are capturing latent value by identifying new ways to monetise assets that were either defunct or deemed to be of low value, thereby breathing new economic life into a mature basin. Recommissioning the Thames pipeline will not only save the Group up to �100 million in capital costs, but will turn stranded fields into valuable gas for the benefit of all: our investors, the economy and the exchequer. This innovative thinking is exactly what the next phase of the North Sea requires, especially in an era of increasing gas imports and coal�s decline as an energy source.