IGas Energy splashes out £110m on Petronas assets

City A.M. Reporter

YSIA’S national oil company Petronas said yesterday it will sell the oil production business of its UK subsidiary Star Energy Group to IGas Energy for £110m.

This is part of its strategy to focus on growing its European asset returns through marketing and trading, Petronas said in a statement.

In 2011, Star Energy is expected to produce an estimated 2,800 barrels of oil equivalent per day, it said.

Petronas also entered into a long-term gas supply agreement with IGas Energy through its London-based subsidiary Petronas Energy Trading to take up to 150bn cubic feet of natural gas produced by IGas Energy.

IGas’ Aim-listed shares jumped 5.8 per cent yesterday.

The firm, which has a market cap of £81m, financed the deal using a new loan facility from Macquarie Bank.