By Iain Packham

LONDON--U.K. North Sea-focused oil company Xcite Energy Ltd. (XEL.LN) said Tuesday it has amended its Bentley oilfield offtake services agreement with BP PLC (BP.LN), in a deal it says will add significant financing for the second stage of the oilfield development program, through a combination of reserves based lending and flexible working capital support.

Under the terms of the agreement, BP will provide $5 million of financing for Phase 1B of the Bentley field development, as part of the reserves-based lending facility being negotiated with a group of commercial banks.

For an initial phase of up to three years BP will deliver dilutant products in-field to Xcite Energy, for blending with the heavy Bentley crude to maximize its value prior to offtake by BP.

BP has also undertaken to provide further support to Xcite during the initial phase, by reducing Xcite Energy's working capital requirements for the dilutant products to be used in the blending-in-field operations.

At current oil prices, this working capital support is estimated to be in the range of $20 million to $40 million depending on Bentley crude production and blending requirements, in respect of which Xcite Energy would pay BP an appropriate commercial financing charge.

Xcite said these increased financial commitments replace the previous commitment to procure $20 million of financing from a commercial bank with credit support from BP.

Xcite shares closed Monday at 87.5 pence.

Write to Iain Packham at iain.packham@dowjones.com