Last checked at 19 Jan 2016 08:33
19 January 2016
Baron Oil plc
("Baron " or "the Company")
Farm-in to Northern Ireland Petroleum Licence PL1/10
The Company notes the announcement released this morning by InfraStrata plc ("InfraStrata"), regarding the Woodburn Forest-1 well and its funding.
Under the terms of the funding announced by Infrastrata, Baron has agreed to enter into a Farmout Agreement ("FOA") with Infrastrata and Brigantes Energy Limited ("Brigantes") to earn a 10% interest in the Northern Ireland Petroleum Licence PL1/10 ("PL1/10") and to acquire a corresponding 10% interest in the adjacent offshore Petroleum Licence P2123 ("P2123"). Under the terms of the FOA, Baron has agreed to pay consideration of £570k to Infrastrata, as operator of the licences, representing back costs and Baron's share of funding for the Woodburn Forest-1 well. The cost of this consideration will be met from the Company's existing unrestricted cash resources, the balance of which was £2.25 million (unaudited) as at 31 December 2015.
A prospectivity review of the PL1/10 licence in Northern Ireland was prepared by project geoscience consultants Merlin Energy Resources Limited ("Merlin") in 2013 and published on Infrastrata's website (www.infrastrata.co.uk). Merlin identified combined un-risked P50 prospective resources on the PL1/10 licence in the Triassic and Permian sandstone reservoir intervals of over 450 million barrels of oil ("mmbo"), of which 25 mmbo were ascribed to the first target Woodburn Forest prospect.
Under the terms of the FOA, the assignment of interests in PL1/10 is subject to the approval of the Department of Enterprise, Trade and Investment ("DETI") for PL1/10 and the Oil and Gas Authority ("OGA") for P2123. As announced by Infrastrata, the other parties to enter into an FOA today include Tudor Hall Energy Limited (10%), Southwestern Resources Limited (16%) and Petro River UK Limited (9%) (the "Other Parties").
Upon all agreements becoming unconditional and proceeding as announced and anticipated, the Woodburn Forest-1 well will be fully funded by Baron and the Other Parties.
For further information:
Baron Oil Plc
Bill Colvin (Chairman & CEO) Tel: +44 (0) 7780 684 108
Cantor Fitzgerald Europe
Nominated Adviser and Broker
Sarah Wharry (Corporate Finance) Tel: +44 (0) 20 7894 7000
In accordance with the AIM Rules - Note for Mining and Oil and Gas Companies, the information contained in this announcement has been reviewed by Malcolm Butler, a geologist with over 40 years' experience who has a BSc in Geology from Aberystwyth University, a PhD in Geology from Bristol University and is a Chartered Geologist. The information prepared in this announcement is in accordance with the Petroleum Resource Management System as published by the Society of Petroleum Engineers.