News/Media

Acquisition of Yorkshire Exploration
Egdon Resources plc (AIM:EDR) is pleased to announce that it has reached an agreement to acquire the entire issued share capital of Yorkshire Exploration Limited (“YEL”). YEL is a private company, which holds an 8% interest in Petroleum Exploration and Production Licence PEDL068 in North Yorkshire and Cleveland in the Cleveland Basin. Egdon is operator of PEDL068 with a 40% interest.The consideration for this acquisition is £133,058 and will comprise £75,000 to be satisfied by the issue of new Egdon shares to YEL at completion and the assumption of £58,058 of YEL debt. The number of consideration shares will be calculated based on the average closing mid-price for the five days prior to the day of completion. The commercial date of the transaction is 1 August 2014. The transaction is subject to approval of the change of control by DECC.YEL is owned and controlled by Mr. John Rix and his family members. Mr. Rix was a non-executive Director of Egdon until his retirement from the Board in late 2011.Licence PEDL068 contains the Kirkleatham gas field which is shut-in pending the potential drilling of a side-track well to target an un-drained portion of the field up-dip from the existing producer well. The licence also contains the Westerdale/Ralph Cross gas discovery where planning consent is in place for an appraisal well, which is likely to be drilled in 2015/2016. Exploration in PEDL068 to date has concentrated on conventional Permian age carbonate gas plays but the licence may also contain other conventional and unconventional prospectivity.Egdon estimates that the transaction will add approximately 0.70bcf of Best Estimate Contingent and Prospective Conventional Resources to Egdon’s resource inventory.The current interests in PEDL068 are as follows:Egdon Resources U.K. Ltd40.00%Sterling Resources (UK) Ltd47.00%Yorkshire Exploration Limited8.0%Montrose Industries Limited5.0%Commenting on the acquisition, Mark Abbott, Managing Director of Egdon said:
The acquisition of YEL adds to our existing interest in PEDL068 and adds incremental conventional resources and other prospectivity to the Company
Final Results for the Year Ended 31 July 2014
Completion of drilling operations - Burton on the Wolds-1 exploration well (PEDL201)
Egdon Resources plc (AIM:EDR) announces the completion of drilling operations at the Burton on the Wolds-1 conventional exploration well in UK Onshore Licence PEDL201 in Leicestershire.The Burton on the Wolds-1 well was spudded on 18 October 2014 and reached a total depth of 1086 metres on 28 October 2014. The well penetrated only thin sands in the primary reservoir objective, the Rempstone Sandstone group, while the deeper secondary objective was encountered as non-reservoir rock.Electric wireline logs have now been acquired in the well. Although weak hydrocarbon shows were observed while drilling through the Rempstone sands, interpretation of the log data indicates the thin sands to be water bearing.The well is currently being plugged before the drilling rig is released from contract and, in due course, the well-site will be restored to its original condition as agricultural land.The interests in Licence PEDL201 and the Burton on the Wolds-1 well are:Egdon Resources U.K. Limited32.50% (Operator)Celtique Energie Petroleum Limited32.50%Terrain Energy Limited12.50%Corfe Energy Limited12.50%Union Jack Oil plc 10.00%As a result of previously announced farm-outs, Egdon’s net share of the Burton on the Wolds-1 well cost is 15%.Commenting on the Burton on the Wolds-1 result, Mark Abbott, Managing Director of Egdon said:
Whilst we are naturally disappointed with the results of Burton on the Wolds-1, I am pleased to report that operations to date have been successfully completed with no safety incidents or impact on either the local environment or the local community. Furthermore, the drilling of the well has been accomplished ahead of schedule and within budget.Egdon recognised that the principal pre-drill risks associated with the Burton on the Wolds prospect were the local development of the Rempstone sands and the presence of reservoir quality rocks at the deeper objective. In line with the Company´s strategy, we were able to mitigate our exposure to these risks by bringing new partners into the licence group.Egdon will now use information gained from Burton on the Wolds-1 to evaluate the remaining prospectivity of the acreage held under licence PEDL201. In the meantime Egdon is progressing its plans to commence flow testing the Wressle-1 well in PEDL180/182 in Lincolnshire and we will update shareholders with results of this in due course.
Planning approval granted for Kiln Lane Well, onshore UK (PEDL181)
Egdon Resources plc (AIM:EDR) notes the press release made today by Europa Oil & Gas (Holdings) plc (“Europa”) advising the granting of planning consent for the Kiln Lane-1 conventional exploration well in Lincolnshire Licence PEDL181 where Egdon holds a 25% interest.Europa as the operator of PEDL181 has today advised that it was “pleased to announce its proposal to drill the Kiln Lane conventional exploration well on licence PEDL 181 in East Lincolnshire has been approved by the Planning Committee at a meeting held today at Grimsby town hall. The approval is subject to the signing of a Section 106 agreement which is currently being finalised.”Europa’s CEO, Hugh Mackay also stated,
“Planning approval is an important step and, subject to the granting of an Environmental Agency permit in a timely manner, we remain on course to commence operations at Kiln Lane by year end. We are keen to drill a conventional well at Kiln Lane not only because we estimate it holds gross prospective resources of 2.9 mmbo and has a one in three chance of success, but also because it is located on a large undrilled licence. Success would open up a new conventional oil and gas play and in the process de-risk additional leads identified.”
Commencement of drilling operations - Burton on the Wolds-1 exploration well (PEDL201)
Egdon Resources plc (AIM:EDR) is pleased to announce the commencement of drilling operations at the Burton on the Wolds-1 conventional exploration well in UK Onshore Licence PEDL201 located in Leicestershire.The Burton on the Wolds-1 well “spudded” (began drilling) at 07.30 hours on 18 October 2014. Drilling operations are expected to take around 26 days. The planned vertical well will be relatively shallow with a total drilled depth of around 1,000 metres.The Burton on the Wolds Prospect is defined on proprietary 2D seismic data, which was acquired by Egdon in May 2011. Evaluation has highlighted a conventional oil prospect with targets at two distinct Carboniferous stratigraphic levels. The shallower target, the Rempstone Sandstone, is productive at the nearby Rempstone Oil Field. A seismic anomaly, possibly indicative of a carbonate reef, underlies the Rempstone Sandstone and provides a deeper secondary target. The mean combined Prospective Resources for the two target objectives, as calculated by Egdon are estimated to be 3.8 million barrels of oil.The Burton on the Wolds-1 well has been designed to intersect both targets in a favourable position near the crest of the structure.The interests in Licence PEDL201 and the Burton on the Wolds-1 well are:Egdon Resources U.K. Limited32.50% (operator)Celtique Energie Petroleum Limited32.50%Terrain Energy Limited12.50%Corfe Energy Limited12.50%Union Jack Oil plc10.00%As a result of previously announced farm-outs, Egdon’s net share of the cost of the Burton on the Wolds-1 well will be 15%.Operations at this site will not, neither now nor in the future, involve the process of hydraulic ‘fracking’ for shale gas.Commenting on the start of drilling operations at Burton on the Wolds-1, Mark Abbott, Managing Director of Egdon said:
“We are pleased to report commencement of the drilling of the second of our East Midlands conventional exploration wells, following on from the positive results at Wressle-1, where logged hydrocarbons are due to be tested. We look forward to updating shareholders with the results from Burton on the Wolds-1 in around four weeks’ time. Our conventional exploration drilling programme is a key part of our growth strategy, with successful exploration capable of delivering near-term additions to our reserves, production and revenue streams.”
Operations Update and Notice of Final Results
Egdon Resources plc (AIM:EDR), the UK-based exploration and production company with a primary focus on the hydrocarbon-producing basins of the onshore UK, reports the following operations update ahead of the announcement of the Company’s Final results scheduled for 11 November 2014.Egdon continues to make good progress across the business. Average net daily production for the financial year to 31 July 2014 was 238 boepd against our production guidance of 200 boepd, helped by strong performance from the Ceres gas field. Liquids production for the period was 53 boepd net.Additional detailed work has now confirmed the preliminary evaluation of the Wressle-1 well results, which were announced on 2 September 2014 and which indicated potential hydrocarbon bearing zones in three separate reservoir intervals. We are currently finalising the design and logistics for the testing programme and expect to commence testing using a work-over rig during November 2014 following the drilling of the Burton on the Wolds-1 conventional exploration well where operations have now begun.The Company will be an active participant in the 14th UK Landward Licensing Round which closes on 28 October 2014, with any new licence awards anticipated during 2015.The next six months will be busy for Egdon, with a new operated drilling campaign expected to commence early in 2015. This programme is expected, subject in part to planning consent, to comprise three operated onshore exploration wells for conventional hydrocarbons at Laughton, North Kelsey and Biscathorpe. In addition operations at the non-operated Kiln Lane well could start before year end. This programme of wells will expose the Company to material resource potential. Additional wells for both conventional and unconventional hydrocarbons are planned for drilling later in 2015.The Company will be announcing its Final results for the year ended 31 July 2014 on Tuesday 11 November 2014. There will be an analyst meeting at 9.30am at the offices of Buchanan, 107 Cheapside, London, EC2V 6DN.Commenting on this update Mark Abbott, Managing Director of Egdon said:
“We have made good progress with all aspects of the business over the last year and I look forward to updating shareholders in detail on 11 November. The coming few months will see the results of the Burton on the Wolds exploration well, testing of Wressle-1 and the start of a further conventional drilling programme.”
Timing Update - Burton on the Wolds-1 exploration well (PEDL201)
Egdon Resources plc (AIM:EDR) is pleased to provide an update on the expected timing of the Burton on the Wolds-1 conventional exploration well in UK Onshore Licence PEDL201 located in Leicestershire.The drilling rig and associated equipment has been demobilised from the Wressle-1 well-site following the completion of that well for future testing operations. The rig will now drill a single well for Alkane Energy plc, which was deferred to enable the Wressle-1 well to be drilled, before then mobilising to Burton on the Wolds. Well-site construction at Burton on the Wolds has been completed and it is anticipated that operations will commence by mid-October.We will provide a further update to shareholders on commencement of drilling operations.The Burton on the Wolds Prospect is defined on proprietary 2D seismic data which was acquired by Egdon in May 2011. Evaluation has highlighted a conventional oil prospect with targets at two distinct Carboniferous stratigraphic levels. The shallower target, the Rempstone Sandstone, is productive at the nearby Rempstone oil field. A seismic anomaly, possibly indicative of a carbonate reef, underlies the Rempstone Sandstone and provides a deeper secondary target. The mean combined Prospective Resources for the two target objectives, as calculated by Egdon are estimated to be 3.8 million barrels of oil.The planned vertical well will be relatively shallow with a drilled depth of around 1,000 metres. It has been designed to intersect both targets in a structurally favourable position near the crest of the Burton on the Wolds structure.The interests in Licence PEDL201 and the Burton on the Wolds-1 well are:Egdon Resources U.K. Limited32.50% (operator)Celtique Energie Petroleum Limited32.50%Terrain Energy Limited12.50%Corfe Energy Limited12.50%Union Jack Oil plc10.00%As a result of previously announced farm-outs, Egdon’s net share of the cost of the Burton on the Wolds-1 well will be 15%.For the avoidance of doubt the Burton on the Wolds prospect is a conventional oil prospect and our operations will not, either now or in the future, involve the process of hydraulic ‘fracking’ for shale gas since the area around the Burton on the Wolds prospect has neither the required conditions nor the specific rock-types present for shale gas exploration.
Preliminary Results of the Wressle-1 Exploration Well
Egdon Resources plc (AIM:EDR) is pleased to announce the preliminary results from drilling of the Wressle-1 conventional exploration well located to the East of Scunthorpe.
The Wressle-1 well was spudded on 18 July 2014 and on 23 August 2014 reached a total depth (TD) of 2240 metres measured depth (MD) (1814 metres true vertical depth below OS datum (TVDSS)). Elevated mud gas readings were observed over large parts of the interval from the top of the Penistone Flags reservoir target (1831.5 metres MD) to TD.
The well was logged using measurement whilst drilling (MWD) logging tools run on the drill string. Preliminary petrophysical evaluation of the log data has indicated the presence of potential hydrocarbon pay in three main intervals;
- Penistone Flags - up to 19.8 metres measured thickness (15.9 metres vertical thickness)
- Wingfield Flags - up to 5.64 metres measured thickness (5.1 metres vertical thickness)
- Ashover Grit - up to 6.1 metres measured thickness (5.8 metres vertical thickness)
The well is currently being completed with a 4 ½" liner to enable selective and sequential testing of these intervals as part of an extended well test, for which planning consent has already been received. These test operations, which will be designed to determine the flow rates, hydrocarbon type and hence commerciality of the Wressle-1 well, will be undertaken using a work-over rig and are expected to commence during October 2014.
Further updates will be given as these operations progress.
The interests in the Wressle-1 well are:
Egdon Resources U.K. Limited25.00% (Operator)Celtique Energie Petroleum Limited33.33%Europa Oil & Gas Limited33.34%Union Jack Oil plc8.33%
Commenting on the results Mark Abbott, Managing Director of Egdon said:
"We are very encouraged by the preliminary evaluation of Wressle-1- our first exploration well in the East Midlands Basin - with interpretation of potential hydrocarbon pay of over 30 metres thickness (measured) in three discrete reservoir intervals. Our attention now moves to designing and delivering a testing programme for these intervals to determine the potential for a commercial discovery and we look forward to updating shareholders once these operations commence."
Commencement of drilling operations - Wressle-1 exploration well (PEDL180)
Egdon Resources plc (AIM:EDR) is pleased to announce the commencement of drilling operations at the Wressle-1 conventional oil exploration well in Lincolnshire Licence PEDL180 located to the East of Scunthorpe.The Wressle-1 well "spudded" at 0300 hours on 19 July 2014. Drilling operations are expected to take around 38 days.The planned well will be drilled as a deviated well to a total depth of about 2,300 metres (ca. 1,850 metres TVDSS). It has been designed to intersect a number of prospective Upper Carboniferous age sandstone reservoirs in a structurally favourable position near the crest of the Wressle structure.The Wressle Prospect is defined on proprietary 3D seismic data, which was acquired by Egdon in February 2012. The Prospect is located on trend with the producing Crosby Warren oil field and the Broughton-B1 oil discovery, both to the immediate northwest, and the Brigg-1 oil discovery to the immediate southeast. All contain oil in various different sandstone reservoirs within the Upper Carboniferous succession. The gross mean Prospective Resources at Wressle, as calculated by Egdon, are estimated to be 2.1 million barrels of oil.The interests in PEDL180 and the Wressle-1 well are:Egdon Resources U.K. Limited25.00% (Operator)Celtique Energie Petroleum Limited33.33%Europa Oil & Gas Limited33.34%Union Jack Oil plc8.33%
Operations at this site will not - either now or in the future - involve the process of hydraulic ‛fracking’ for shale gas.
Commenting on the commencement of drilling operations Mark Abbott, Managing Director of Egdon said:
"We are pleased to be commencing a more active operational period with the start of drilling operations on the Wressle prospect and we look forward to updating shareholders with the results from this well towards the end of August. Success in our conventional exploration drilling programme could lead to near-term additions to our production and revenue stream and is a key part of our strategy."
Holdings in Company
Egdon Resources plc (the "Company") was informed today that as a result of the recent open offer the beneficial shareholdings in the Company of Mr Ken Ratcliff and Mr Walter Roberts, Non-executive Directors, have increased by 3,259 shares and 22,743 shares respectively.Mr Ratcliff’s total beneficial shareholding in Egdon Resources plc is now 159,759 ordinary shares, representing 0.07% of the issued and voting share capital of the Company. Mr Roberts’ beneficial shareholding in Egdon Resources plc is now 1,114,493 ordinary shares, representing 0.50% of the issued and voting share capital of the Company.
Appointment of Non-Executive Director
Egdon Resources plc (AIM:EDR) is delighted to announce the appointment of Neil O’Brien as a Non-Executive Director of the Company with immediate effect. Neil is Chief Executive Officer of Alkane Energy plc which holds 40,000,000 ordinary shares of Egdon, representing approximately 18 per cent. of Egdon’s issued share capital.
Neil is a qualified Chartered Accountant with over 20 years’ management experience within the UK and Europe. After qualifying at Coopers Lybrand, Neil joined Blue Circle Industries PLC where he held a number of senior financial roles including a period as Finance Director of Blue Circle’s French based Heating Products operations. More recently Neil was Finance Director at Speedy Hire PLC the UK’s largest rental company and a FTSE250 member. During Neil’s ten years at Speedy Hire the group was transformed from a generalist building group to focus on the Speedy brand which grew revenues to over £450m in 2008. Neil joined Alkane Energy plc as Chief Executive Officer in November 2008.
Neil Christopher O’Brien, aged 51, is currently a Director of, or during the past five years has been a Director of, the following companies:
Current directorshipsAlkane Energy plcAlkane Biogas LimitedAlkane Energy UK LimitedAlkane Pro2 Services LimitedCoalgas (Cymru) LimitedCoalgas (Europe) LimitedEastern Pegasus LimitedMW Renewables LimitedSeven Star Natural Gas LimitedRegent Park Energy Limited
Neil O’Brien has an interest in 749,000 ordinary shares of Alkane Energy plc.
There is no further information to be disclosed under Rule 17 or Paragraph (g) of Schedule 2 of the AIM Rules for Companies.
Philip Stephens Chairman of Egdon, commented:
"On behalf of the Board, I am delighted to welcome Neil O’Brien as a Non-Executive Director of Egdon. Neil brings a wealth of valuable experience to the Company, particularly in the UK energy sector. We all look forward to working with him as we continue to grow the business."
Favourable Holmwood Court of Appeal Decision
Egdon Resources plc notes the announcement made today by Europa Oil and Gas (Holdings) plc (Europa), the operator of PEDL143, regarding the Court of Appeal decision in relation to the Holmwood prospect.Europa has advised that the Court of Appeal has today dismissed an appeal by the Leith Hill Action Group against the High Court judgment in Europas favour, in relation to the drilling of an exploratory well at the Holmwood prospect (Holmwood) in the PEDL143 licence in the Weald Basin, Surrey. Egdon holds a 38.4 per cent. interest in PEDL143.As a result of the Court of Appeal ruling, the High Court judgment of 25 July 2013, is upheld. Europas appeal against Surrey County Councils refusal to grant planning permission to drill one exploratory borehole and undertake a short term test for conventional hydrocarbons at the Holmwood prospect will therefore be remitted to the Planning Inspectorate for redetermination. This may involve a further planning inquiry.
Update on transfer of onshore shale gas business
Further to the announcement of 5 June 2014, Egdon wishes to notify that it has now obtained consent from DECC for the transfer of licences from Alkane. As a consequence, admission of the new ordinary shares issued pursuant to the transaction with Alkane, the Placing and Open Offer, and completion of the acquisition, is now expected to become effective on 12 June 2014.Mark Abbott, Managing Director of Egdon commented:
"We are delighted to have obtained consent from DECC enabling the transfer of licences in Alkanes shale-gas interests. Following this transfer, Egdons prospective acreage in UK shale-gas will nearly double to 140,176 acres, creating a significant new UK shale-gas player."
Result of Extraordinary General Meeting
The Directors of Egdon Resources plc are pleased to announce that at the Extraordinary General Meeting held at the offices of Norton Rose Fulbright LLP on 5 June 2014, all resolutions put before shareholders at the meeting were duly passed.Details of voting at Egdon EGM of 5 June 2014
Update on transfer of onshore shale gas business
Further to the announcement of 13 May 2014, Egdon wishes to notify that it is still awaiting consent from DECC for the transfer of licences from Alkane and now expects this consent to be obtained by 12 June 2014. As a consequence, admission of the new ordinary shares issued pursuant to the transaction with Alkane, the Placing and Open Offer, is now expected to become effective on or around 12 June 2014 rather than 6 June 2014 as originally notified.
Results of Open Offer
As announced on 13 May 2014, the Company entered into a conditional agreement to acquire the onshore shale gas business and assets of Alkane Energy plc, which was, inter alia, conditional upon shareholder and DECC approval. At the time, the Company alsoannounced details of a conditional Placing to raise £6.4 million (before expenses) through the issue of 32,000,000 Ordinary Shares at an Issue Price of 20p per share and an Open Offer to raise up to a further £0.6m through the issue of up to 3,033,663 Ordinary Shares at an Issue Price of 20p per share. The Open Offer closed for acceptances at 11.00a.m. on 30 May 2014. The Company is pleased to announce that it has received valid acceptances from Qualifying Shareholders in respect of 16,261,629 Open Offer Shares, including applications for 14,565,911 Open Offer Shares under the Excess Application Facility. This represents approximately 536 per cent of the maximum Open Offer Shares available under the Open Offer and as such the Open Offer has been oversubscribed. Qualifying Shareholders who have validly applied for Open Offer Shares will receive their full Open Offer Entitlement and, following a pro-rata scaling back, approximately 9.185 per cent of any Open Offer Shares they applied for under the Excess Application Facility. The Company has therefore raised the maximum gross proceeds of £606,709 (before expenses) through the Open Offer.Both the Placing and Open Offer remain conditional upon, amongst other things, the approval by Shareholders of the Resolutions at the General Meeting of the Company to be held at 11a.m. on 5 June 2014, and the Placing Agreement becoming unconditional in all respects.It is expected that Admission will become effective and dealings in the Open Offer Shares will commence on or around 6 June 2014.Capitalised terms used in this announcement are as defined in the shareholder circular.A further announcement will be made in due course.
PEDL201
Egdon Resources plc (AIM:EDR) notes the announcement made today by Union Jack Oil plc ("UJO") of the results of a resource assessment commissioned from Molten Limited by UJO in respect of the shale potential of the northern parts of PEDL 201.
Egdon has a 32.50% interest in, and is operator of PEDL 201.
