North Sea exploration and production company Longboat Energy plc (LBE) is accelerating its mission to create a full-cycle North Sea exploration and production company.
It was established by the ex-Faroe Petroleum management team, and chief executive Helge Hammer says the strategy is to replicate the success of Faroe which was “very much built on exploration success and transactions.”
At Faroe the team grew reserves from 19 MMboe to 98 MMboe between 2013 and 2018, and Hammer is very optimistic that the adoption of Faroe’s model will help Longboat deliver similar outcomes.
The focus is the 18-month, seven exploration well drilling campaign. The second well has just been spudded and, depending on the weather, a third well will be drilled in parallel. Hammer says these are very significant targets and the combined resources at the three wells named Rødhette, Egyptian Vulture and Mugnetind, range from 25 to 60 million boe, or million barrels of oil equivalent.
Should there be success Hammer says the next steps could include a trade of a discovery into a producing asset, or it “could be that we need to take it forward through an appraisal campaign to mature it further.”
The company has options, and should all seven wells prove to be dusters, then there are other transactions being negotiated and Hammer is hopeful these will be delivered before the end of the current drill programme.
He is though quietly confident one or more of the seven will yield results. “The reason we went for this seven-well farm in portfolio approach which was so successful when I was in Faroe, is by drilling seven wells, all independent targets, I think we have a very low chance of them all being failures.”
As for results from the first two exploration wells, investors won’t have to wait long with predictions of November for a shareholder update.
Longboat Energy (LBE)