PEDL201 Farm out Agreement

RNS Number : 1426Y

Egdon Resources PLC

19 February 2013

 



19 February 2013

EGDON RESOURCES PLC

("Egdon" or "the Company")

Farm-out of interest in PEDL201

Egdon Resources plc (AIM:EDR) is pleased to announce the farm-out of a further 5% interest in Petroleum Exploration and Development Licence 201 ("PEDL201") located in Nottinghamshire and Leicestershire to Union Jack Oil plc ("Union Jack").

Under the terms of the agreement, Union Jack will pay 10% of the cost of the planned Burton on the Wolds-1 exploration well to earn a 5% interest from Egdon.  As a result Egdon's exposure to the well is reduced to 15% of costs. Union Jack has also agreed the same terms with Celtique Energie Petroleum Ltd ("Celtique") to result in a 10% total licence interest.

On completion the licence interests in PEDL201 will be as follows:

Egdon Resources U.K. Limited	32.50% (operator)
Celtique Energie Petroleum Limited	32.50%
Terrain Energy Limited	12.50%
Corfe Energy Limited	12.50%
Union Jack Oil plc	10.00%

The transfer of interests is subject to approval by the Department of Energy and Climate Change.

PEDL201 was awarded in 2008 and is located on the southern margin of the Widmerpool Gulf geological basin.  The Burton on the Wolds Prospect has been mapped on proprietary 2D seismic data, which was acquired by Egdon in May 2011.  Evaluation has highlighted a prospect with targets at two distinct 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. The mean combined Prospective Resources for the primary and secondary objectives, as calculated by Egdon are estimated to be 3.8 million barrels of oil.

The planned well will be shallow with a drilled depth of around 1000 metres to test both targets. A planning application has been finalised and is expected to be submitted shortly.  Subject to planning it is intended that the Burton on the Wolds-1 well will commence drilling late in the second quarter of 2013.

Commenting on the farm-out Mark Abbott, Managing Director of Egdon said:

"We look forward to working with Union Jack in exploring the Burton on the Wolds Prospect.  The prospect combines a lower risk reservoir target offsetting nearby production with a higher risk, higher potential play at present untested in the basin.  This further farm-out agreement enables Egdon to manage both the technical and financial risks associated with this project.

As part of our stated strategy to manage risk and accelerate activity, we have embarked on a more active marketing campaign and I am pleased to report that we are in advanced discussions regarding further farm-outs on a number of our projects. I hope to be able to report further progress with these in the coming weeks."

For further information please contact:

Egdon Resources plc
Mark Abbott	01256 702292
Buchanan
Richard Darby, Gabriella Clinkard	020 7466 5000
Nominated Adviser and Broker - Seymour Pierce (in administration) David Porter, Rick Thompson (Corporate Finance)
Richard Redmayne (Corporate Broking)	020 7107 8000

Notes to Editors:

Egdon Resources plc

Egdon Resources plc (LSE: EDR) is an established UK-based exploration and production company primarily focused on onshore exploration and production in the hydrocarbon-producing basins of the UK and France. 

Egdon currently holds interests in twenty nine licences in the UK and France and has an active programme of exploration, appraisal and development within its balanced portfolio of oil and gas assets.  Egdon is an approved operator in both the UK and France.

Egdon was formed in 1997 and listed on AIM in December 2004.

In accordance with the AIM Rules - Note for Mining and Oil and Gas Companies, the information contained in this announcement has been reviewed and signed off by the Managing Director of Egdon Resources plc Mark Abbott, a Geoscientist with over 26 years' experience.

Evaluation of potential recoverable hydrocarbons has been assessed in accordance with 2007 Petroleum Resources Management System prepared by the Oil and Gas Reserves Committee of the Society of Petroleum Engineers (SPE) and reviewed and jointly sponsored by the World Petroleum Council (WPC), the American Association of Petroleum Geologists (AAPG) and the Society of Petroleum Evaluation Engineers (SPEE).

 

END

 

 

AGRDVLFFXLFBBBF