BG Group sells Italian exploration subsidiary to CPL Concordia

By the OGJ Online Staff

LONDON Oct. 29 -- BG Group PLC plans to sell its Italian exploration subsidiary BG Rimi SpA to CPL Concordia Soc. Coop. ARL of Modena for 34 billion lire.

The assets include nine exploration permits and 18 production concessions. BG is keeping 12 exploration licenses in the Po Valley and Sicily Channel. They have been transferred to BG Italia SpA.

In 2000 BG Rimi had net gas production of 72 million cu m.

Yvonne Barton, president of BG Italia, said, "This sale is part of BG Group's strategy of disposing of noncore assets. We have rationalized our exploration and production presence in Italy to concentrate our activities on larger exploration prospects in the Po Valley and the Sicily Channel. Our commitment to the Italian energy market is further supported by our Serene power generation activities and our plans to develop the Brindisi liquefied natural gas project."

Roberto Casari, president of CPL Concordia, said, "This important acquisition is in line with CPL Concordia's strategy to be involved in the whole gas chain in Italy, following liberalization of the Italian gas market. CPL Concordia will increase the gas supply of its subsidiary Energia della Concordia with the acquisition of BG Rimi."

The cash sale is expected to be completed at the end of November.

BG Group has been active in Italy since 1992 operating as BG Italia, and BG Rimi. Following this transaction, all operations will be carried out through BG Italia.

With partners ENI SpA and Edison SpA, BG Italia is involved in exploration in the Po Valley and the Sicily Channel. It is also a partner in Serene SpA, a joint venture that owns and operates 400 Mw of co-generation units at five sites adjacent to Fiat Auto factories.

BG Italia is promoting a $300 million LNG import terminal in Brindisi on the southeast coast of Italy. It is envisaged that a first train could be supplying the Italian market from early 2006.

BG Group also said Monday it has entered into a long-term charter for a new LNG ship from Golar LNG Ltd.

The 138,000 cu m capacity ship will be constructed by Daewoo of Korea and is due to be delivered in March 2003. The charter is for a fixed 20-year period.