UK: RWE Dea Signs a Suite of Agreements for Breagh Field Gas Processing

RWE Dea announced today the signature of a suite of agreements providing for the processing and redelivery at the Teesside Gas Processing Plant (TGPP) of gas to be produced from its operated Breagh gas field in the UK North Sea, including agreements to facilitate the construction of a 10km long onshore section of pipeline across Teesside and required construction works at the TGPP (a plant owned by Teesside Gas & Liquids Processing (TGLP)).

The processing and redelivery agreement covers the entire Breagh field life. Amongst the services to be provided by TGLP are the processing of Breagh gas production within a dedicated unit at the TGPP, with onward redelivery of gas to the UK National Transmission System and/or local customers. TGLP will also provide remote operational services to the offshore Breagh Alpha platform facility and will undertake ongoing operational and maintenance related services to the onshore section of the Breagh pipeline.

A separate agreement with px Group (px) provides for the construction and installation of onshore 20” and 3” pipelines and telemetry system from Coatham Sands, Redcar to the TGPP. In addition to their existing responsibility for operation and management of the TGPP, px will manage the construction of the onshore pipeline, with subcontracts in respect of this work expected to be awarded before the end of 2010.

The Breagh gas field is located in UKCS block 42/13 of the southern North Sea in 62 metres water depth, approximately 100 kilometres to the east of Teesside. Field development is envisaged in two phases with gas being exported via a 20″ pipeline to be laid from the Breagh Alpha platform facility to the TGPP via Coatham Sands, Redcar.

RWE Dea holds a 70 percent interest in the Breagh gas field as operator, with the remaining 30 percent interest held by Sterling Resources (UK) Limited. The estimated resources make Breagh and the surrounding fields one of the largest natural gas discoveries still to be developed in the UK Southern North Sea. The gas field is a conventional Carboniferous reservoir and the expected reserves will make a significant contribution to the growth of RWE Dea’s gas production in the UK. Further upside potential is expected in the surrounding exploration blocks. The Breagh Phase 1 development is expected to receive Government approval in Q4 of this year.

“Following on from the recent award for the construction of the Breagh Alpha platform facility, the signature of this suite of agreements is another major milestone in bringing the Breagh gas field into production. We are happy to enter into this long term relationship with this highly regarded gas processing terminal and its operator. We look forward to achieving initial gas production of Breagh by mid-2012,” said Ralf to Baben, Chief Operating Officer of RWE Dea AG.

RWE Dea AG, headquartered in Hamburg, is an international company operating in the field of exploration and production of natural gas and crude oil. The company deploys state-of-the-art drilling and production technologies, putting its many years’ experience acquired to good use. RWE Dea has set new standards in the fields of safety and environmental protection.

RWE Dea has stakes in production facilities and concessions in Germany, the UK, Norway, Denmark and Egypt and holds exploration concessions in Algeria, Ireland, Libya, Mauretania, Morocco, Poland and Turkmenistan. Moreover, in Germany, RWE Dea also operates large subterranean storage facilities for natural gas. RWE Dea is part of the RWE Group, one of Europe’s largest energy utilities.

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Source: RWE Dea,September 30, 2010,