Sterling Farms Out Stake in Offshore UK Block to Lundin
Sterling Resources has signed a letter agreement with Lundin Heather Limited under which Lundin will acquire a 40% interest in Blocks 210/25b, 210/29 and 210/30 in the UK North Sea. Sterling currently has a 60% working interest in the blocks, which will reduce to 36% as a result of the farmout.
Lundin will earn its interest by paying 61.54% of the first GBP10 million dry hole costs of a well to test an Upper Jurassic play on the Blocks and will become operator. Any costs in excess of this amount will be paid by the parties according to their working interests.
Lundin is operator of the nearby Heather oilfield and platform, and brings valuable knowledge of the area to the joint venture and a facility through which a discovery could be produced.
Sterling plans to farm out an additional 10 to 12.5% working interest prior to drilling and is currently in discussions with interested parties.
The agreement is subject to the approval of the UK Department of Trade and Industry, a formal agreement and certain other conditions.
In other news, Sterling reports that the Cetatuia exploration well, onshore Romania, which has been delayed due to the impact of wet weather on the road and site construction, is now expected to spud during the week of May 22nd. The drilling unit is on location and final rigging up is in progress. The well will be the first drilled by Sterling on its 1.5 million acre Craiova Concession. It will be drilled to approximately 2,700 meters to test two main targets, one in the Miocene and the other in the Middle Triassic. The well is expected to take approximately 30 to 35 days to drill. Sterling has a 60% working interest and is operator.
Also, Sterling's consultants have recently completed a study, using only the limited existing geological and geophysical data, to assess the prospectivity of the remainder of the Craiova Concession. The report has identified 21 leads to date throughout the Concession which will be evaluated by acquiring further seismic and integrating the results into the existing data. Seismic acquisition programs are now being planned to begin during the second half of the year.
Operates 2 Offshore Rigs
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