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(Alliance News) - Angus Energy PLC said Monday that Saltfleetby Energy has started the process of submitting an application to the UK Oil & Gas Authority for the transfer of an interest in the Saltfleetby licence to Angus.
In June, Angus agreed to buy 51% stake in the Saltfleetby gas field in Lincolnshire, England. Approval from the OGA remains as one of the final conditions of the agreement.
As part of the deal, Saltfleetby Energy will pay Angus an initial GBP2.5 million, which Angus will either use to reconnect the field to the UK gas grid or for abandonment costs, if reconnection is not commercially viable.
To prepare for the chance of abandonment, the company prepared an internal abandonment report which has been reviewed by an independent will examiner.
The report supported Angus's third party quote for decommissioning all wells at GBP1.8 million. When added to the site remediation estimate, this brings the total potential gross liability to GBP2.5 million, in line with expectations.
Angus believes reconnection is commercially feasible and believes work can be completed between May and August 2020.
Shares in Angus Energy were down 2.9% at 1.12 pence on Monday.