Deltic Energy PLC Completion of Farm Out of SNS Gas Licences (5662R)
08 Noviembre 2021 - 1:00AM
UK Regulatory
TIDMDELT
RNS Number : 5662R
Deltic Energy PLC
08 November 2021
8 November 2021
Deltic Energy Plc / Index: AIM / Epic: DELT / Sector: Natural
Resources
Deltic Energy Plc ("Deltic" or 'the Company')
Completion of Farm Out of Southern North Sea Gas Licences to
Cairn Energy PLC
Deltic Energy Plc, the AIM quoted natural resources investing
company with a high impact, natural gas focussed exploration and
appraisal portfolio in the Southern North Sea, is pleased to
announce completion of the farm-out agreement (the "Farm Out
Agreement" or the "Farm Out") of five of its gas licences in the
Southern North Sea with Cairn Energy PLC ("Cairn") through Cairn's
wholly owned subsidiary, Nautical Petroleum Limited.
Following announcement of the Farm Out Agreement on 12 August
2021, Deltic and Cairn have received the necessary regulatory
approvals from the Oil & Gas Authority and have entered into
joint operating agreements for each of the five licences.
Under the terms of the Farm Out Agreement:
-- Cairn has paid Deltic consideration of USD$1 million by way
of contribution towards historic back costs.
-- Cairn now holds a 60% interest in each of Licences P2428
(Cupertino Area) and P2567 (Cadence) and a 70% interest in each of
Licences P2560, P2561 and P2562 which are located between the
Breagh and Tolmount Gas Fields.
-- Deltic therefore now has a 40% interest in licences P2428 and
P2567 and a 30% interest in licences P2560, P2561 and P2562.
-- Cairn is funding 100% of an agreed work programme for each of
the five licences up to the point of making a drill or drop
decision on each licence.
-- Following a drilling decision being made on either of P2428
and P2567, Cairn will fund 70% of the costs of whichever well is
drilled first, subject to a gross well cost cap of USD$25
million.
-- Cairn will now become Operator of each of the five licences.
Since announcement of the Farm Out, the shooting of 3D seismic
data over Licence P2428 and surrounding areas, a key component of
the work programme, has commenced. ION Geophysical are currently in
the process of acquiring approximately 700km(2) of seismic data,
which is focussed on the Plymouth Zechstein Reef Prospect and will
de-risk future drilling. The survey is expected to be completed
before the end of November with processed data due to be delivered
in the second quarter of 2022.
Graham Swindells, Chief Executive of Deltic Energy,
commented:
"Completion of this transformational multi-licence farm out
marks the formal commencement of our partnership with Cairn which
will see significant investment being made in Deltic's strategic
Southern North Sea gas exploration portfolio. Ahead of completion
of the transaction we have already begun working with Cairn to
progress activities on the licences. I am particularly pleased that
the new 3D seismic survey has commenced so quickly after
announcement of the farm out, demonstrating a shared commitment to
immediately accelerate the development of these licences and hence
timeline to potential drilling.
We look forward to building our partnership with Cairn, as we
continue to develop our conveyor belt of Southern North Sea gas
prospects towards drilling."
**ENDS**
For further information please contact the following:
Deltic Energy Plc Tel: +44 (0) 20 7887
2630
Graham Swindells / Andrew Nunn / Sarah McLeod
Allenby Capital Limited (Nominated Adviser Tel: +44 (0) 20 3328
& Joint Broker) 5656
David Hart / Alex Brearley (Corporate Finance)
Kelly Gardiner (Sales and Corporate Broking)
Stifel Nicolaus Europe Limited (Joint Broker) Tel: +44 (0) 20 7710
7600
Callum Stewart / Simon Mensley / Ashton
Clanfield
Vigo Consulting (IR Adviser) Tel: +44 (0) 20 7390
0230
Patrick d'Ancona / Chris McMahon / Oliver
Clark
Notes to Editors
Deltic has created a strategically located portfolio of
high-quality gas exploration licences in the Southern North Sea
over a number of licensing rounds. These licences are located in
areas that have been underexplored despite significant discoveries
such as Tolmount, Breagh, Pegasus and Cygnus, most of which have
gone on to be developed and could provide ready access to export
infrastructure for any future developments on Deltic's licence
acreage.
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END
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