Egdon Resources plc (AIM:EDR) is pleased to announce the sale of a 20% interest in the recently acquired producing Fiskerton Airfield oil field in Lincolnshire licence EXL294 to Union Jack Oil plc (“Union Jack”).
The cash consideration for the 20% interest is approximately £137,000. In addition, Union Jack will wholly fund re-processing of the 3D seismic dataset at a gross cost of £35,000. The combined consideration and carry is equivalent to approximately £165,000 (or approximately $218,000).
The effective date of the agreement is 3 November 2017 and Union Jack will receive 20% of all production revenues from Fiskerton from that date. Completion of the acquisition is subject to Oil and Gas Authority approval.
Following completion of the transaction the interests held in EXL294 will be:
Egdon Resources U.K. ltd 80%
Union Jack Oil plc 20%
On 10 July 2017 Egdon Resources U.K. Limited (or “the Company”) announced the acquisition of a 100% interest in, and operatorship of the Fiskerton Airfield oil field from Cirque Energy (UK) Ltd (“Cirque”) for a cash consideration of $750,000. This acquisition completed on 27 October 2017.
Commenting on the sale, Mark Abbott, Managing Director of Egdon Resources plc, said:
“We are pleased to welcome Union Jack as a partner on the Fiskerton Airfield Oil Field. We have elected to sell a minority interest in the field to manage our overall financial exposure to the asset going forward and to enable evaluation of the up-side at minimal cost through the carried seismic reprocessing. As we stated back in July 2017 the field has suffered from a lack of investment over recent years and we plan to undertake simple low-cost workovers to enhance production and profitability in the short-term, adding valuable near-term cash-flow to Egdon’s portfolio. In the longer term, the reprocessed 3D seismic will inform our views on the potential to enhance productivity through in-fill drilling.”