Egdon Resources announced Tuesday that it has reached agreements for separate farm-outs of License PEDL005(R), located in Lincolnshire, UK, to Terrain Energy Limited and Union Jack Oil.
License PEDL005(R) contains the Keddington producing oil field, which is part of the Louth oil prospect, and the North Somercotes gas prospect. Under the terms of the Terrain farm-out, Terrain will earn an additional 20 percent interest in the Keddington field in return for paying 40 percent of the cost of a new appraisal/development well, which is expected to be drilled in 4Q 2015 as a side-track to the Keddington-4 well.
Under the Union Jack Oil farm-out, Union Jack will earn a 10 percent interest in License PEDL005(R), in return for paying 20 percent of the cost of the new side-track appraisal/development well at Keddington and 20 percent of the cost of an exploration well on the Louth prospect.
Mark Abbott, managing director of Egdon Resources commented in a company statement:
“These two transactions are designed to optimise the balance of risk and reward for the company in the exploration and development of PEDL005(R), reducing the company’s financial exposure to these upcoming wells. In the case of Keddington, this would now see Egdon paying only 15 percent of the costs of the new appraisal/development well but retaining 45 percent of the field’s production.”
Transfer of the interests is subject to regulatory approval from the Oil & Gas Authority.
Have a news tip? Share it with Rigzone!
WHAT DO YOU THINK?
Click on the button below to add a comment.
Generated by readers, the comments included herein do not reflect the views and opinions of Rigzone. All comments are subject to editorial review. Off-topic, inappropriate or insulting comments will be removed.
More from this Author
Most Popular Articles
From the Career Center
Jobs that may interest you