SSE has entered into an agreement with Total E&P UK to acquire a 20% interest in four gas fields in the Greater Laggan Area.

The deal includes the surrounding acreage in the area, approximately 125km north west of the Shetland Islands, along with a 20% interest in the new Shetland Gas Plant.

The fields to be acquired by SSE from Total E&P UK are new and will have relatively low operating costs.

They are not yet producing gas, but the Greater Laggan Area development is expected to commence production later this financial year and peak production – at around five million therms of gas per day (SSE will share one million therms per day) - is expected to be achieved during 2016.

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The value of the deal will include a consideration of £565 million for the assets, plus an additional forecast investment of £350 million in the period to 2018 to complete the entire development.

Alistair Phillips-Davies, Chief Executive of SSE said: "As we have regularly said, most recently in our trading statement last week, we are focused on maintaining a balanced range of energy businesses, and we have regularly set out our wish to seek new opportunities to increase SSE’s presence in the upstream gas sector where assets can be acquired for a fair price, and that is exactly what this deal represents."

(LM)