LONDON (Thomson Financial) - EnCore Oil Plc. said it is now unlikely to
demerge its EnCore Gas Storage Ltd. as it waits for the results of the
forthcoming Esmond evaluation well.
While not ruling out the Gas Storage demerger, the company said it is now
unlikely as it believes it can return value to shareholders without the
additional cost and time involved in a listing and demerger, the plans for which
were postponed on Apr. 8.
However, the company said it could still decide to sell the unit depending
on drilling results for its proposed Esmond and Gordon Gas Storage Project,
shared with Petronas' Star Energy.
"Once the results of this well are known, and assuming they come within the
expected range of outcomes then it is likely that EnCore may seek to sell its
100 percent subsidiary, EnCore Gas Storage Ltd," EnCore said, adding that it
continues to receive expressions of interest in participating in the proposed
Esmond and Gordon Gas Storage project. Star will bear the cost of the drilling
of the well at this project, which could be drilled between late August and
early September.
EnCore also said it is in talks concerning the possible sale of its unit
EnCore Nederland B.V., whose principal asset is 10 per cent. of the Amstel
field.
In updates for other projects, EnCore said that test results indicate a
significant volume in place at the Cobra well but that the well likely requires
a fraccing programme to make the discovery commercial. The company will begin a
feasibility study to examine the economic and technical potential for
development of the field, and in the event of a positive outcome further
drilling is expected to begin in late 2009. EnCore is operator of the field with
a 20 percent interest.
EnCore has also been awarded two licences in the 13th Landward Licensing
Round. PEDL 240 is contiguous with its existing licences held with Northern
Petroleum on the Isle of Wight, and the second PEDL 253 licence is located in
Lincolnshire around the area of Biscathorpe.
EnCore has also received planning permission for the drilling of Markwells
Wood (formerly East Horndean), which is expected to be drilled in 2009.
"Following a number of informal expressions of interest in our onshore
acreage, EnCore is currently reviewing its position on both onshore U.K. and
France," the company said.
TFN.newsdesk@thomson.com
jro/ajb
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