German utility giant E.ON has agreed a price of E690 million to buy North Sea gas producer Caledonia Oil and Gas Limited.

E.ON, which already holds assets in the UK under its E.ON UK subsidiary, will acquire interests in a total of 15 gas fields in the UK Southern North Sea containing 14 billion cubic meters of reserves.

The assets are expected to be developed over the next ten years and will be piped to the UK through two pipelines which the German energy outfit will also own as part of its purchase of Caledonia.

The acquisition of Caledonia brings us significantly closer to our goal of covering 15%-20% of the gas needs of E.ON Ruhrgas from our own production in the long run. This investment is fully in line with our strategy of enhancing E.ON’s gas procurement. Of course, the acquisition also fully meets our stringent investment criteria, E.ON CEO Wulf Bernotat was reported as saying by Dow Jones.