The Company is pleased to announce the appointment of WH Ireland Limited as Egdon’s Nominated Adviser (“Nomad”) and joint broker.
Egdon Resources plc (AIM: EDR, “Egdon”) is pleased to advise the signing of a legally binding and confidential settlement agreement (the “Settlement Agreement”) between Egdon Resources U.K. Limited (acting on behalf of the PEDL253 joint venture partners) and Humber Oil & Gas Limited (“Humber”). The joint parties to PEDL253 have therefore resolved the dispute arising under the JOA and look forward to co-operating in the future in the development of the licence.
Upon implementation of the terms of the Settlement Agreement Egdon Resources U.K. Limited will hold a 35.8% operated interest in PEDL253.
Egdon has previously announced the results of a detailed evaluation of the Biscathorpe project which concluded that a possible material and commercially viable hydrocarbon resource remains to be tested. In summary;
- Economic modelling indicates a financially robust project even in the current oil price environment
- The principal Westphalian target has an estimated un-risked gross NPV(10) of £55.6 million
- Break-even full-cycle economics estimated to be (NPV(10)) US$18.07 per barrel of oil
- A 57 metre oil bearing section in the Dinantian Carbonate of Biscathrope-2 represents a secondary target with potentially significant commercial upside
- Future identified drill targets are accessible via a side-track of the suspended Biscathorpe-2 well.
Mark Abbott, Managing Director of Egdon Resources plc, commented: “We are pleased that agreement has been reached with Humber, enabling the project to now move forward with full support from all partners.
Having retained the wellsite, the JV has maintained its optionality to pursue a cost effective side-track to test the resource potential of not only the Basal Westphalian Sandstone play, but also to appraise the oil column demonstrated in the deeper Dinantian Carbonate reservoir.
Our detailed work has concluded that a potentially material and commercially viable hydrocarbon resource remains to be tested at Biscathorpe.
We look forward to providing further updates to shareholders as the Biscathorpe project develops.”
Egdon Resources plc (AIM:EDR) is pleased to provide an update on UK offshore licences P1929 and P2304 (“the Licences”) and the Farm-In Agreement with Shell U.K. Limited (“Shell”).
As advised on 21 January 2020, the farm-in by Shell was conditional upon;
- Receiving approval from the Oil & Gas Authority (“OGA”); and
- Agreement of a mutually acceptable forward work programme and timeline with the OGA
In December 2019 Egdon announced that the OGA had granted extensions to the Licences to 31 May 2020. I am pleased to report that the OGA has now agreed to extend further the licence terms and amend the work obligations for both P1929 and P2304 as follows:
P1929 and P2304
The initial term of the Licences shall be extended to 31 May 2024; subject to fulfilling the following firm commitments;
- by 31 May 2021, acquire 400 km2 of 3D seismic in P1929 and P2304 or relinquish the Licences
- by 30 November 2022, undertake to drill one well in either P1929 or P2304 to a depth of 1700 metres True Vertical Depth Subsea (TVDss), or 75 metres below the Base Permian Unconformity; or relinquish the Licences
We will now progress the assignment of the licence interests and operatorship of the Licences to Shell. On completion Egdon will retain a 30% interest in the Licences. Under the terms of the Farm-In Agreement, Shell will pay 85% of the costs of the acquisition and processing of the 3D seismic survey covering both the Resolution and Endeavour gas discoveries. The carry on the acquisition costs will be capped at US$5 million gross, beyond which Egdon would pay 30% of the survey costs. Furthermore, Shell will also pay 100% of all studies and manpower costs through to the well investment decision on the Licences.
Commenting on the update, Mark Abbott, Managing Director of Egdon Resources plc, said:
“Working closely with our partner Shell, we are pleased to have reached agreement with the OGA to extend the Licences coupled with revised work obligations and timelines. We will now focus on completing the licence assignments and transfer of operatorship to Shell and progressing the planned appraisal activity on the Resolution and Endeavour gas discoveries.
The first part of this work programme will be the acquisition of a marine 3D seismic survey. We look forward to building on our close working relationship with Shell and benefitting from their substantial worldwide operational experience and expertise; notably the development of carbonate reservoirs characteristic of the Resolution and Endeavour discoveries.”
Egdon Resources plc (AIM: EDR, “Egdon”) is pleased to provide an update on the Wressle development in North Lincolnshire Licences PEDL180 and PEDL182 where the Company holds a 30% operated interest.
The Wressle development was granted planning consent on appeal on 17 January 2020. The Planning Inspector also allowed Egdon’s application for costs against North Lincolnshire Council (“NLC”) and we can advise that the gross sum of c. £403,000* has now been received from North Lincolnshire Council as settlement in full of these costs.
As previously advised the plan for the Wressle development comprises the following key stages:
- Discharging the planning conditions, finalising detailed designs, tendering and procurement of materials, equipment and services and finalising all HSE documentation and procedures
- Installation of groundwater monitoring boreholes and establishing baseline groundwater quality through monitoring and analysis
- Reconfiguration of the site
- Installation and commissioning of surface facilities
- Sub-surface operations
- Commencement of production
Following NLC approval of the installation plan and discharge of the associated planning condition we have now completed the installation of four groundwater monitoring boreholes on the Wressle site. These boreholes will be subject to monitoring and analysis throughout the life of the site, with an initial three months of sampling to determine baseline groundwater quality.
As previously advised, on current plans, the Company envisages first oil during H2 2020.
Commenting, Mark Abbott, Managing Director of Egdon Resources plc, said:
“We continue to make good progress with the Wressle development despite the current challenging operating environment. The successful installation of the groundwater monitoring boreholes represents an important step in the progress to first oil which will increase Egdon’s production by 150 barrels of oil per day.. Wressle remains economically robust with an estimated project break-even oil price of $17.62 per barrel. We are also pleased to have received the costs in full from North Lincolnshire Council which strengthens our finances.”
*This will be divided between partners proportionate with their interests.
Egdon Resources plc (AIM:EDR) announces that on 24 April 2020, Mark Abbott, Walter Roberts and Tim Davies, all Directors of the Company, acquired shares as detailed below as part of the second tranche of the Subscription announced on 14 April 2020 at a price of 2p per share.. (Read more…)