TIDMDELT
RNS Number : 3377L
Deltic Energy PLC
10 September 2021
The information contained within this announcement is deemed by
the Company to constitute inside information for the purposes of
Regulation 11 of the Market Abuse (Amendment) (EU Exit) Regulations
2019/310. With the publication of this announcement via a
Regulatory Information Service, this inside information is now
considered to be in the public domain.
10 September 2021
Deltic Energy Plc / Index: AIM / Epic: DELT / Sector: Natural
Resources
Deltic Energy Plc ("Deltic" or 'the Company')
Licence P2428 - Commencement of 3D Seismic Survey Following Farm
Out
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, following the recent Farm Out with Cairn Energy PLC
("Cairn") in relation to five of Deltic's gas licences in the
Southern North Sea (the "Farm Out"), the acquisition of 3D seismic
data over Licence P2428 and surrounding areas has commenced.
The Company has been informed by ION Geophysical ("ION") that
the seismic vessel, under contract to ION, has mobilised to site
with survey commencement expected on 11 September 2021. The
acquisition of approximately 700km(2) of 3D seismic data, which is
focussed on the Plymouth Zechstein Reef Prospect, will take
approximately six to seven weeks to complete with processed data
due to be delivered mid-2022.
Under the terms of the Farm Out agreement, Cairn are responsible
for 100% of the costs of the associated work programme (including
seismic acquisition and processing) up to the point at which a well
investment decision is made.
Completion of the Farm Out is conditional on the entering into
of a Joint Operating Agreement and obtaining standard regulatory
consents from the UK Oil & Gas Authority. Following completion
of the farm out, Deltic will hold a 40% non-operated interest in
Licence P2428.
Graham Swindells, Chief Executive of Deltic Energy,
commented:
"To be acquiring new 3D seismic so quickly after announcing our
transformational Farm Out with Cairn is another very positive
development which will accelerate the development of our technical
understanding of the opportunities on this licence. The survey
represents another important milestone for Deltic and we are
delighted to be participating in our first field operations with
our new partner. The acquisition of high quality modern 3D seismic
over the licence area is a key step in de-risking future
exploration drilling on this licence ."
**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 &PR 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.
P2428 (Cupertino Area) and P2567 (Cadence Area)
-- The P2428 licence area was awarded in the 30(th) Offshore
Licensing Round and contains prospects and leads at multiple
geological levels. The key prospect identified by Deltic is the
Plymouth Prospect, a large Zechstein carbonate build-up, which is
analogous to Deltic's Pensacola Prospect and the Crosgan discovery.
Other leads have been identified in the Leman Sandstone and the
Carboniferous sections. The area is currently imaged on legacy 2D
seismic data dating back to the early 1990s and new 3D seismic will
be acquired to support a well investment decision on this
licence.
-- The P2567 licence was award in the 32(nd) Offshore Licensing
Round and contains prospects in the Triassic Bunter Sandstone and
the Carboniferous. The Carboniferous is the primary focus and
Deltic has identified the large intra-Carboniferous Cadence
prospect and believes the Base Permian Unconformity (BPU) subcrop
play is also prospective across the licence area.
-- Under the terms of the Farm Out Agreement, Cairn will acquire
a 60 per cent. interest in each of Licences P2428 and P2567, and
will be appointed as the licence Operator, in return for paying 100
per cent. of the costs of an agreed forward work programme up to
the date on which a well investment decision is made.
-- It is expected that the work programme over these two licence
areas will involve the acquisition and processing of new 3D seismic
data across P2428 and P2567 and the associated interpretation and
studies required to support a well investment decision.
-- Should a well investment decision be made on either of the
two licences Cairn will fund 70% of the costs of the first
exploration well drilled, subject to a gross well cost cap of
USD$25 million.
-- Following completion of the Farm-out, Deltic will retain a 40
per cent. non-operated interest in Licence P2428 and P2567.
P2560, P2561 & P2562 (South Breagh Area)
-- The P2560, P2561 and P2562 licence areas were awarded in the
32(nd) Offshore Licensing Round and are located between two
significant gas fields in Breagh and Tolmount, located to the north
and south respectively. Exploration in the area has been
constrained historically by lack of high-quality 3D data and Deltic
believes there is significant potential in the Zechstein, Leman and
Carboniferous sections across the acreage. Having only been
recently awarded, these assets are less mature in terms of Deltic's
geological understanding compared to the Cupertino and Cadence
areas.
-- Under the terms of the Farm Out Agreement, Cairn will acquire
a 70 per cent. interest in each of Licences P2560, P2561 and P2562,
and will be appointed as the licence Operator, in return for paying
100 per cent. of the costs of an agreed forward work programme on
each licence, up to the date on which a well investment decision is
made on each licence.
-- The work programme over these licences is expected to involve
the purchase and reprocessing of legacy datasets to improve image
quality and/or the acquisition of new 3D seismic data across all or
part of the licenced areas. This will be supported by the various
interpretation workflows and other studies required to make the
various well investment decisions on each licence.
-- All costs incurred post a well investment decision will be
satisfied by each party in proportion to their working
interest.
-- Following completion of the Farm-out, Deltic will retain a 30
per cent. non-operated interest in Licences P2560, P2561 and
P2562.
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