Egdon to Increase Stake in Wressle Oil Discovery
Egdon Resources plc announced Monday the acquisition of an additional five percent interest in PEDL180 and PEDL182, which contain the Egdon operated Wressle oil discovery and Broughton North Prospect, from Celtique Energie Petroleum Limited.
Under the terms of the agreement, Egdon will acquire the additional stake for a deferred cash consideration of $558,382 (GBP 417,000) payable on commencement of production. The effective date for the transaction is January 1, 2018.
Union Jack Oil plc and Humber Oil & Gas Limited will each also acquire 12.50 percent in both PEDL180 and PEDL182 from Celtique Energie Petroleum Limited on the same terms under separate deals.
Egdon said it will “shortly” submit a new planning application for the Wressle development. An application to extend the current planning consent for the Wressle site was submitted on April 13.
The transactions are subject to approval from the Oil and Gas Authority. On completion, the interests in PEDL180 and 182 will comprise:
- Egdon Resources U.K. Limited (Operator) 30.00 percent
- Europa Oil and Gas plc 30.00 percent
- Union Jack Oil Plc 27.50 percent
- Humber Oil & Gas Limited 12.50 percent
“Today’s transaction underlines our confidence in the quality and deliverability of the Wressle project,” Mark Abbott, managing director of Egdon Resources plc, said in a company statement.
“We have been able to add to our existing material interest in the licenses with the consideration deferred to the point of revenue generation from the Wressle field. The transaction emphasizes our strategy to achieve a balanced business comprised of revenue generating conventional assets to complement the high-impact UK unconventional licenses within our portfolio,” he added.
Commenting on Egdon’s deal, Jack Allardyce and Ashley Kelty, oil and gas research analysts at Cantor Fitzgerald Europe, said they viewed the acquisition positively.
“We view the deal as a good one, allowing Egdon to increase its stake in the project at no up-front cost, highlighting management's belief in Wressle and streamlining the ownership of the field,” the analysts said in a brief note sent to Rigzone.
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