* Centrica, QPI to look at joint investment opportunities
* To look at new or existing projects in upstream oil and
* Centrica shares up 0.80 percent
By Adveith Nair
LONDON, Dec 5 British utility Centrica
has signed a memorandum of understanding to look at
joint investment opportunities with Qatar Petroleum, two weeks
after announcing a billion pound deal to buy a string of assets
from Norwegian group Statoil.
Centrica said on Monday investment targets will include new
or existing projects in upstream oil and gas including LNG, gas
storage as well as combined-cycle gas turbine generation assets
and downstream opportunities.
The news comes as the company targets growing production by
50 percent to 75 million barrels of oil equivalent annually in
the next three to five years, prompting speculation more deals
as big as the one with Statoil could be in the offing.
Centrica also said last month it would invest in its
upstream oil and gas business to strengthen its energy hedge.
RBC analyst John Mush, who said last week additional
acquisitions the size of the Statoil deal cannot be ruled out,
warned that further upstream investment would increase the
company's exposure to gas prices.
"In our view this increased exposure to gas prices will
increase volatility and thus reduce multiples investors are
willing to pay for Centrica," Musk had said.
Centrica shares were up 2.1 pence at 298.54 pence at 1030
Monday's agreement, inked at the World Petroleum Conference
in Doha, follows the long-term LNG contract Centrica signed with
the emirate earlier this year.
Qatar Petroleum International is the international
investment arm of Qatar Petroleum, while Centrica owns Britain's
largest household energy supplier, British Gas.
"The partnership will enable us to jointly develop
significant energy investments that will further boost the
long-term security of the UK's gas supply," Centrica Chief
executive Sam Laidlaw said in a statement.
"We will also explore joint opportunities to deploy capital
and expertise in other markets to deliver growth and value for
the group," Laidlaw added.
Two weeks ago, Centrica boosted its oil and gas production
by a quarter through buying assets from Statoil and signing a
10-year gas deal that will improve the UK's energy security.