Orcadian Executes Carra Prospect Farm-Out
Orcadian Energy has executed a farm-out deal with Carrick Resources Limited in respect of a sub-area of License P2320 which covers the Carra prospect.
Under the terms of the SPA, the consideration for the transfer of the Carra interest is to be satisfied by the fulfilment of certain work milestones (there is no cash consideration). Carrick will review existing data, acquire a license to, and reinterpret, the seismic data currently being reprocessed by TGS relating to the Carra prospect, and remap the prospect. In return, on completion of the updated mapping, Orcadian will, subject to North Sea Transition Authority approval, assign a 50 percent interest in the sub-area of license P2320, which contains the bulk of the Carra prospect, to Carrick. Carrick may withdraw from the agreement prior to completion of the remapping of the prospect. This work program is anticipated to take four months.
Carrick has agreed that after the transfer, it will then work up the Carra prospect to drill-ready status and manage a further farm-out process on the prospect.
By entering into this agreement with Carrick, Orcadian is building upon the long experience of the Carrick team in this area and is maximizing the potential of this undrilled prospect.
The Carra prospect lies to the East of the Crinan and Dandy discoveries and to the South of Fyne. The Carra prospect is contained in Tay and Cromarty sandstones which lie on trend with Guillemot West, and is a stratigraphic trap associated with a clear amplitude anomaly defined by 3D seismic. The Carra prospect is undrilled and unexplored but early, internal estimates from Carrick indicate there is the potential for it to contain P50 recoverable prospective resources of 30 MMbbls of medium gravity oil.
Carra is a prospect on which Orcadian has undertaken no exploration activities, there is no turnover or profits attributable to the Carra sub-area. The company currently ascribes a nominal value to the Carra sub-area of license P2320.
"We are delighted to have signed the SPA with Carrick. This SPA enables us to further de-risk and maximize value from our assets in a very cost-effective way while developing a drill ready prospect on Carra. Progressing Pilot and the prospects close to it remains our core focus whilst we continue to extract the maximum value on all our assets. We look forward to working with the Carrick team progressing Carra," said Steve Brown, Orcadian's CEO.
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