(Alliance News) - Angus Energy PLC has received regulatory approval for the acquisition of a stake in the Saltfleetby gas field in Lincolnshire, it said Monday.
London-based Angus announced the deal in June, having in late April said it was doing due diligence on a then-unnamed gas field in the UK. The remaining 49% is owned by Wingas Storage UK Ltd, which is to be renamed Saltfleetby Energy.
Saltfleetby was discovered in 1996, having first been explored during the 1980s. The field was put on stream in late 1999, producing gas from Early Westfalian sandstones.
The UK Oil & Gas Authority has now approved the farm-in, and work has already begun on getting the field back connected to the UK's national grid.
Angus has identified most of the long-lead items needed to treat the gas to the correct specifications for the national grid and also has mapped out a pathway for an extra stretch of pipeline needed.
It is preparing planning permission applications, the company continued, and is looking to have a competent persons report out early in 2020.
Angus is preparing to abandon two of the eight wells at the site, and is in talks with an "oil major" over a multi-year annual off-take agreement. It expects the field to produce between 17 million and 19 million therms of gas in its first full year.
"This comes as fantastic news for the company and opens up a pathway towards real production and cashflow without the exploration risk attendant on many other projects. This is gas right next door to one of the dozen or so entry points on the national grid system," said Managing Director George Lucan.
"This is gas producing on a steady and predictable decline curve for 20 years. This is gas to be pulled immediately from two wells which show the same or greater well head pressure than when they were shut in in 2017. Now we have to complete reconnection and start squeezing this gas into people's homes and dividends into shareholders pockets," Lucan added.
Shares were 1.6% higher on Monday afternoon in London at a price of 0.96 pence each.
By George Collard; georgecollard@alliancenews.com
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Angus Energy (ANGS)