Arenite Petroleum has announced the sale of 50% interest in Promote Licence P2304 (UKCS Block 41/24) to Egdon Resources U.K. The consideration comprises paying the regulator the 2017 licence rental and OGA Levy and all transaction legal costs. Future conditional payments to Arenite of up to Â£725,000 net (being 50% of Â£1,450,000 gross) are listed below: On completion of the acquisition of a 3D survey over any part of the Licence (other than a third-party survey to which neither the P2304 Licensees nor the licensees of the P1929 licence have access) a cash payment of fifty thousand Pounds (Â£50,000). On completion of the drilling of the first well located wholly or partly within the area covered by the Licence a cash payment of one hundred thousand Pounds (Â£100,000). On first production, other than testing, from any well located wholly or partly within the area covered by the Licence a cash payment of one hundred thousand Pounds (Â£100,000). On reaching a total production of five billion standard cubic feet of gas (5 bcf) (or oil equivalent) from any wells located wholly or partly within the area covered by the Licence a cash payment of two hundred thousand Pounds (Â£200,000). On reaching a total production of twenty billion standard cubic feet of gas (20 bcf) (or oil equivalent) from any wells located wholly or partly within the area covered by the Licence a cash payment of one million Pounds (Â£1,000,000). Â  P2304 was awarded in the UK Offshore 28th Licensing Round with an effective date of 1 December 2015. By consolidating licences P1929 and P2304 under Egdonâs 100% control, OGA is minded to extend the Initial Term of the Licence until 1 December 2018.Â  The transfer of interests in P2304 from Arenite & Europa to Egdon is subject to regulatory approval. The Resolution (41/18-1, 1966, ~3mmscfgd) discovery and the Maxwell field (wells 41/24a-1 (1969, Total, 15mmscfgd), 41/24a-2 (1982, Total, 19mmscfgd), and 41/24-3 (1991, Conoco, 34 mmscfgd & 1280 bcpd)) have historically been considered to be small accumulations. Reinterpretation of the seismic data shows both fields are part of a much larger regional high structure which has hydrocarbon shows over an area covering up to five North Sea blocks. The Resolution reservoir is a Permian Hauptdolomite carbonate whereas the Maxwell discovery is in the younger naturally fractured Permian Plattendolomite carbonate. Additionally, extensive gas shows were also encountered in the thick underlying Carboniferous sandstones and shales but are yet to be flow tested. Commenting on the acquisition, Mike Cooper, CEO said:  'We are delighted that Egdon recognises the significant extension of the Resolution discovery into block 41/24 where three wells have each tested over 15 million standard cubic feet of gas per day in a shallower horizon than at Resolution. Though the outlook for the oil and gas sector has improved in the last 12 months, it has not been sufficient to deliver a farminee for the P2304 licence in isolation. However, by effectively combining the two licences, Egdon and the Oil & Gas Authority have had the vision of making the âpie biggerâ, significantly improving the opportunity quality and dramatically lowering the economic threshold. This deal is a win-win for all parties and is consistent with OGAâs MER strategy. We wish Egdon every success going forward.' Click here for Egdon Resources announcement: P2304 Offshore Licence Acquisition Click here for Europa announcement: P2034 Offshore Licence Sale Source: Arenite Petroleum 
United Kingdom, not found