The consideration comprises a nominal cash payment on completion.
Pilot is a shallow, heavy oil discovery approximately 41km south of the Venture operated Kittiwake platform. It was discovered in 1989 and to date five exploration and appraisal wells have been drilled. Venture has contracted the Fugro Bucentaur survey drillship to drill a further appraisal well on the Pilot field during summer 2006. If successful the same drillship will drill a further appraisal well into the 28/2-1 discovery in the adjoining block 28/2 (Venture 100%) which was awarded to Venture in the 23rd licensing round in 2005.
Prior to this transaction Venture has recognized 10.1 million barrels of proven and probable reserves (net to Venture) in respect of its existing 47.5% interest in the Pilot discovery. The transaction announced today will add a further 7 million barrels of proven and probable reserves.
Completion remains subject to DTI and other customary regulatory and partner approvals.
Commenting on the news, Mike Wagstaff, Chief Executive of Venture said:
'Venture is pleased to have the opportunity to increase our interest in the Pilot discovery. Combined with this year's appraisal drilling program with the Fugro Bucentaur we see significant scope to refine our reservoir model and add value to these assets in 2006. The viability of heavy oil development has already been demonstrated in the North Sea. With oil prices materially higher than when we acquired our initial interest in Pilot this discovery represents an attractive development opportunity'.
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