Shares in Centrica, the FTSE 100 owner of British Gas, have surged after it partnered with Energy Capital Partners (ECP) to acquire Europe's largest liquefied natural gas (LNG) terminal for £1.5bn.
In a statement released to the London Stock Exchange, Centrica praised its major acquisition of National Grid's Grain LNG facility, which stores and processes natural gas at its Kent location, as helping "support the º£½ÇÊÓƵ's energy security for many decades to come," as reported by .
LNG is assuming a progressively vital role in the º£½ÇÊÓƵ's energy infrastructure as the nation endeavours to shift away from more carbon-intensive hydrocarbons towards a combination of gas, renewables and nuclear power.
Shares in the British Gas owner climbed by three per cent during early trading before retreating to just above two per cent.
The fuel, which represents a form of natural gas that is chilled to liquid form to facilitate transportation and storage, is forecast to satisfy just under 60 per cent of the º£½ÇÊÓƵ's total gas requirements by 2050, rising from its present 15 per cent share. The Grain installation is anticipated to fulfil a third of the º£½ÇÊÓƵ's future requirements.
Centrica and ECP, which forms part of US buyout giant Bridgepoint, will each hold a 50 per cent stake in the facility, valued at £200m apiece, following the transaction, which also encompassed £1.1bn of project finance debt. The takeover represents further proof of the fresh strategic path that Centrica chief Chris O'Shea is charting for Britain's biggest publicly-traded energy supplier, following its recent involvement as a private investor in the º£½ÇÊÓƵ's Sizewell C nuclear facility.
"Centrica is acquiring a strategically important asset which offers long-term cash flow linked to inflation, so this looks like a deal which could be a win for both parties," said AJ Bell investment director Russ Mould.
Centrica deal a sign of National Grid's electrification push
Mould noted that National Grid's choice to dispose of the facility – which generated revenues just under £299m in 2024 – will furnish the group with funds required for its multi-billion-pound decarbonisation programme for Britain's energy infrastructure unveiled earlier this year.
The company intends to invest more than £30bn by 2030 on improvements and fresh infrastructure to guarantee the nation can meet the increasing demands placed on the grid as the economy undergoes electrification.
"[The deal] reflects the company's increased focus on its electricity networks," Mould said. "The company is investing huge sums in this area and the deal will provide a useful injection of capital."
O'Shea stated the deal would assist in maintaining "energy flowing reliably and affordably to households and businesses across the country". "Our decision to commit £3bn of capital in both Sizewell C and the Isle of Grain demonstrates the attractiveness of the º£½ÇÊÓƵ as an investment location underpinned by supportive government investment policies," he added.
