Egdon Resources plc (AIM:EDR) has announced that it has reached agreement to acquire an additional 20% interest in Petroleum Exploration and Production Licence PEDL068 from DESS Energy Limited (DESS) bringing the company’s total interest to 68%. Egdon is operator of PEDL068 which is located in the Cleveland Basin of North Yorkshire. This transaction follows DESS’ acquisition of Sterling Resources (UK) Limited’s 47% interest in the licence.
As consideration for this acquisition, Egdon will bear DESS’s retained 20% share of ongoing expenditure for the next six months and in addition will accept liability for DESS’s 20% share of the existing abandonment liability for the Kirkleatham site and Kirkleatham-1 well, but not for any future works. Egdon estimate that this transaction will add approximately 1.75 bcf of Best Estimate Contingent and Prospective Conventional Resources to its portfolio.
Under a separate transaction, DESS has also sold a 5% interest to existing PEDL068 partner Montrose Industries Limited.
The acquisition is subject to approval by the Oil and Gas Authority (OGA). On completion of these transactions the interests in PEDL068 will be as follows:
*wholly owned subsidiary of Egon Resources
Licence PEDL068, is located in the Cleveland Basin of North Yorkshire and 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. Planning consent has recently been extended for Kirkleatham and allows for drilling and production from a further two wells at the site. The licence also contains the Westerdale/Ralph Cross gas discovery where planning consent is in place for an appraisal well. Exploration in PEDL068 to date has concentrated on Permian age limestone gas plays but the licence also contains prospectivity in deeper Carboniferous age sandstones.
Commenting on the acquisition, Mark Abbott, Managing Director of Egdon said:
““This acquisition builds on our existing interest in PEDL068, adding additional resource potential to the company at low cost and complements our pending award of surrounding licence PEDL259 in the 14th Onshore Licensing Round in what was a highly sought after region.”
Adapted from a press release by Louise Mulhall
Read the article online at: https://www.oilfieldtechnology.com/exploration/22082016/egdon-resources-acquires-additional-interest-in-pedl068/