BG and BP energetic on expansion

TWO UK energy groups are pressing on with international expansion while Energy Minister Brian Wilson makes warning noises about the sale of a third to an Italian bidder.

BG landed a £5bn deal to ship Egyptian gas to France, meeting 10% of French gas demand. BG partners Italy's Edison and two Egyptian firms in the 20-year contract.

BP's expansion plans met a setback when the German Cartel Office blocked the sale of a 25.5% stake in distributor Ruhrgas to giant utility E.On. This is part of a large, complex deal in which BP sells out of Ruhrgas and gets, in exchange, E.On's Aral petrol stations.

E.On will apply confidently to the German government to overturn the cartel ruling. Economics Minister Werner Muller supports the sale, seen as creating a German 'national champion'.

With explorer Enterprise under bid threat from Italy's ENI, Wilson sounded off about the value of independent explorers in the North Sea, from which the Government aims to squeeze 'the last drop of oil'. He warned that this policy was endangered if 'every time an independent makes a breakthrough, it is swallowed up by a larger, less-flexible company'.

But the Energy Department now says: 'Any bid is a matter for the two companies and the competition authorities.'

Any Commission ruling would go to Trade Secretary Patricia Hewitt, but the size of an Enterprise bid means it would probably be decided in Brussels.