Centrica on Monday hastened its retreat from oil and gas exploration after inking a deal to put its European exploration business into a new joint venture with Norway’s Bayerngas Norge.
The owner of British Gas will have a 69% stake in the combined business, which will own largely gas-producing assets in the UK, the Netherlands, Norway and Denmark.
Production from the joint venture is expected to be at 50 to 55 million barrels of oil equivalent from 27 producing fields.
Centrica will pay about £340 million into the new company between 2017 and 2022.
Centrica’s chief executive, Iain Conn, has been refocusing the company on its consumer and services business since he joined the business in 2015, to reduce its exposure to risky exploration activities and volatile oil prices.
Conn said: “This joint venture creates a larger, more sustainable and more capable European E&P business.”
Former boss Sam Laidlaw had taken the UK’s biggest energy supplier into more upstream activities and renewable energy production.