Xcite Energy was in demand yesterday, rising 8.7 per cent to 50p on news of a supply and financing agreement with BP for its flagship asset.

Xcite owns the Bentley heavy oil field, which is one of the largest undeveloped fields of the UK continental shelf. If the company is able to convert the resource base of viscous oil into reserves, Xcite would become the third-largest oil company active in the North Sea, according to analysts.

"This is a very positive step for the company, which has now attracted two very strong partners [Fugro, and now BP] to commercialise the field, said Dougie Youngson of Arbuthnot Securities. "The announcement de-risks the development phase of the project and also enhances its economics as the heavy oil discount should be reduced."