BP gives Xcite a £3m funding boost

Oil giant BP gave Aberdeen-based driller Xcite Energy a funding boost today by contributing $5 million (£3m) to the development of Xcite’s Bentley field in the North Sea.

BP will also reduce the amount of working capital that Xcite must contribute to diluting the heavy oil from the field.

The oil major had previously signed a deal to sell the oil that Xcite extracts from the Bentley field, where it is currently drilling an appraisal well.

Rupert Cole, chief financial officer at Xcite, said: “We are very pleased with this further endorsement and increased support from BP.

Dougie Youngson, an analyst at Seymour Pierce, added: “This is a positive result for Xcite as it provides an element of certainty over future funding.

“The company should be nearing the end of the drilling phase in the short term which will then culminate in an extended flow test at Bentley. This will be the next key share price driver for the company.

“We expect the share price to strengthen today.”