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(Alliance News) - Deltic Energy PLC on Friday said that promising results had emerged from a third-party assessment of its joint-owned Pensacola Discovery reef.
Deltic is a London-based natural resources investor focused on assets in the southern North Sea. The company confirmed the completion of a competent person's report for the Pensacol P2252 licence, in which it holds a 30% interest. Shell and One-Dyas hold the remainder stake, at 65% and 5%, respectively.
The technical review, conducted by RPS Energy Ltd, included a contingent resource assessment for the Pensacola Zechstein Reef. The environmental consultant estimated the Pensacola structure to contain gross P50 hydrocarbons initially in place of 326 million barrels of oil equivalent, broadly in line with Deltic's estimate of 342 MMboe.
RPS also estimated 2C contingent resources of 21.8 MMboe in the combined case, and 15 MMboe in the gas only case.
Given these assessments, RPS believes the reef could net Deltic up to USD205 million in net present value with a 10% forward discount in a combined case, as well as a USD199 million in a gas only case. These NPV10 valuations equate to around 169p to 174p per Deltic share.
The company plans to drill an appraisal well at the Pensacola structure in late 2024.
Progress continues at its Pensacola and Selene farm-out processes, the company said, with a "significant level of interest" from several potential counterparties.
Chief Executive Officer Graham Swindells said: "RPS's validation of our technical assessment of the Pensacola discovery is another step forward for Deltic as we progress towards drilling the appraisal well in late 2024. In particular, we are pleased with the potential valuation that RPS ascribe to the discovery net to Deltic, particularly within the context of our current share price. It's clear that Pensacola is a regionally significant hydrocarbon accumulation, and we will continue to work with our partners at Shell and ONE-Dyas to mature the opportunity and optimise the potential development scenarios as we go forward."
Shares in Deltic Energy were up 2.9% at 23.40 pence each in London on Friday morning.
By Hugh Cameron, Alliance News reporter
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