Egdon Resources PLC Farm-out of PEDL143 Holmwood Prospect (4267R)
June 29 2015 - 2:00AM
UK Regulatory
TIDMEDR
RNS Number : 4267R
Egdon Resources PLC
29 June 2015
29th June 2015
EGDON RESOURCES PLC
("Egdon" or "the Company")
Farm-out of PEDL143, Holmwood Prospect, Weald Basin, UK
Egdon Resources plc (AIM:EDR) is pleased to announce that it has
reached agreement in respect of a farm-out of Weald Basin,
Petroleum Exploration and Development Licence PEDL143 to UK Oil
& Gas Investments PLC ("UKOG").
PEDL143 contains the Holmwood Prospect, which the PEDL143
partnership plan to test with the Holmwood-1 exploration well.
Regulatory consent to drill the well is currently awaiting the
outcome of a planning inquiry held by the Planning Inspectorate
following appeal by the license group. The operator of PEDL143 is
Europa Oil & Gas Limited ("Europa").
Under the terms of the agreement, UKOG will pay a 40% share of
the Holmwood-1 drilling costs in order to acquire a 20% working
interest in PEDL143 from Egdon. UKOG's share of well costs will be
capped at GBP1.2 million net to UKOG (i.e. 40% of a gross
Holmwood-1 well cost estimate of GBP3 million). Gross well costs
above GBP3 million, should they arise, will be met according to the
working interests in PEDL143. Egdon's interest in the licence on
completion will be 18.4%.
Completion of the transaction is subject to the grant of
planning consent for the Holmwood-1 well and to receipt of the
necessary approval from the Oil & Gas Authority.
Commenting on the transaction, Mark Abbott Managing Director of
Egdon Resources said:
"We are pleased to have concluded this deal with UKOG within
their core business area. The transaction means that should
planning consent be granted for the well, Egdon will retain a
material interest in the Holmwood Prospect whilst minimising the
Company's financial exposure and managing our technical risk while
evaluating the prospect's potentially significant prospective
resource."
For further information please contact:
Egdon Resources plc
Mark Abbott, Jerry Field 01256 702 292
Buchanan
Richard Darby, Anna Michniewicz 020 7466 5000
Nominated Adviser and Broker - Cantor Fitzgerald Europe
David Porter, Sarah Wharry (Corporate Finance) 020 7894 7000
Richard Redmayne (Corporate Broking)
Joint Broker - VSA Capital Limited
Andrew Monk (Corporate Broking) 020 3005 5000
Andrew Raca (Corporate Finance)
Notes to Editors:
The Holmwood Prospect:
The Holmwood Prospect is one of the largest undrilled prospects
in the Weald Basin and was independently assessed by Troy Ikoda in
2004 as having potential gross Best Estimate Prospective Resources
of 41.5 bcf. However, the recent discovery of oil at Horse Hill-1
some 10km to the East increases the chances of oil rather than gas
being present at Holmwood. A Competent Persons Report by ERC
Equipoise Limited, published in June 2012 on Europa's website
(http://www.europaoil.com/documents/CPR_Europa_Final_070612.pdf)
estimates that the Holmwood prospect could contain mean gross
unrisked prospective resources of 5.6 million barrels of oil for
the combined Portland and Corallian objectives.
The original planning application for the Holmwood-1 exploration
well was refused by Surrey County Council in May 2011. An initial
planning appeal was dismissed by the Planning Inspectorate in
September 2012. The licence group received a favourable judgment at
the High Court in July 2013 quashing the Planning Inspector's
original decision and a second appeal against the initial Surrey
County Council refusal of Planning Consent was heard during May and
June 2015. We are currently awaiting the decision of this appeal
which is anticipated later in the summer.
The Company:
Egdon Resources plc (LSE: EDR) is an established UK-based
exploration and production company primarily focused on onshore
exploration and production in the hydrocarbon-producing basins of
the UK and France.
Egdon currently holds interests in thirty four licences in the
UK and France and has an active programme of exploration, appraisal
and development within its balanced portfolio of oil and gas
assets. Egdon is an approved operator in both the UK and
France.
Egdon was formed in 1997 and listed on AIM in December 2004.
In accordance with the AIM Rules - Note for Mining and Oil and
Gas Companies, the information contained in this announcement has
been reviewed and signed off by the Managing Director of Egdon
Resources plc Mark Abbott, a Geoscientist with over 26 years'
experience.
Evaluation of potential prospective resources has been assessed
in accordance with 2007 Petroleum Resources Management System
prepared by the Oil and Gas Reserves Committee of the Society of
Petroleum Engineers (SPE) and reviewed and jointly sponsored by the
World Petroleum Council (WPC), the American Association of
Petroleum Geologists (AAPG) and the Society of Petroleum Evaluation
Engineers (SPEE).
This information is provided by RNS
The company news service from the London Stock Exchange
END
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