Tue, 1st Oct 2019 07:00
1 October 2019
EGDON RESOURCES PLC
("Egdon" or "the Company")
Egdon Resources plc (AIM:EDR) is pleased to provide an update on production and operations following the end of the Company's 2018-2019 financial ("FY2019") on 31 July 2019. The Company's preliminary results are scheduled to be announced on 19 November 2019.
Egdon's net production from the Ceres gas field and the Keddington and Fiskerton Airfield oil fields during FY2019 period was 66,364 barrels of oil equivalent ("boe"), at an average of 182 boe per day ("boepd") (FY2018 12,691 boe, 70 boepd), in line with previously stated guidance. Production recommenced from the Ceres well in late October 2018 following installation of a new flow meter driving a significant increase in production over the previous financial year.
Egdon will provide production guidance for the financial year ending 31 July 2020 ("FY2020") with the preliminary results, but initial guidance for the first half of the financial year is c. 170-180 boepd with Mercury gas backout volumes receivable by Ceres partners ceasing at the end of December 2019.
Earlier this year Egdon applied for and received a number of onshore licence extensions from the Oil and Gas Authority as follows:
· Continuation of the Second Term of PEDL180 and PEDL182 to August 2021.
· Initial Terms were extended for PEDL143 (to September 2022), PEDL306 (to July 2024), PEDL334 (to July 2024).
· Retention Area licence durations were extended for PEDL191 (to June 2023), PEDL201 (to June 2024) PEDL202 (to June 2023) and PEDL209 (to June 2023).
· PEDL181 was converted to 14th Round terms and passed into the production period.
On 12 September 2019, Egdon announced the results of the core analysis with combined Bowland shale gas in place of 640 bcf/square mile ("the resource density"). This is more than three times Egdon's previous external estimates of the mean resource density for the entire Bowland Shale section in PEDL139/140 as reported by ERCE in 2014.
The results from this extensive modern dataset demonstrate that the Bowland Shale of the Gainsborough Trough, where Egdon currently holds 82,000 net acres (128 square miles), compares favourably with some of the best US commercial shale plays and is potentially world class.
The company looks forward to sharing further data on the well as it become available, particularly on the secondary target, the tight gas sands of the Millstone Grit.
Further detailed technical analysis of the data from the Biscathorpe-2 well reported in July 2019 has upgraded the well results. The results of a revised petrophysical analysis and detailed geochemical analysis of drill cutting samples undertaken by Applied Petroleum Technology (UK) Limited ("APT") confirmed the likely presence of a 35 metre column, of good quality oil, within the Dinantian interval. This, along with the elevated gas readings and oil shows over an extended interval in the well, are indicative of proximity to an effective petroleum system and validate the potential that exists within the PEDL253 licence area.
Subsequent to our last update substantial progress has been made, including the reprocessing of 85 square kilometres of the existing 3D seismic data. The results of the interpretation of these data will be reported on in due course and will inform the next steps for the project which could include a side track of the suspended Biscathorpe-2 well that would target reservoirs in the Westphalian and Dinantian. Any future drilling would require additional consents including planning permission.
The Wressle oil development has the potential to add 150 bopd to the Company's production. Egdon's extensively revised development proposals for the Wressle oil discovery were refused planning consent in November 2018, with that refusal appealed in February 2019.
The public inquiry in respect of Egdon's appeal against this refusal will be held between 5 and 13 November 2019. Egdon's case will be presented by a QC supported by expert witnesses. The timing of the public inquiry has resulted in the company delaying its preliminary results announcement to 19 November 2019.
As advised in July 2019, North Lincolnshire Council will no longer present evidence at the public inquiry having withdrawn its case in respect of this appeal following agreement of acceptable planning conditions during August 2019. A decision is expected around the turn of the year. Should approval be forthcoming Egdon will need to discharge all conditions prior to commencing operations and would hope to have first production some six months after a decision.
For further information please contact:
Egdon Resources plc
Mark Abbott / Martin Durham 01256 702 292
Ben Romney, Chris Judd 020 7466 5000
Nominated Adviser and Joint Broker - Cantor Fitzgerald Europe
David Porter/ Rick Thompson (Corporate Finance) 020 7894 7000
Caspar Shand Kydd (Sales)
Joint Broker - VSA Capital Limited
Andrew Monk (Corporate Broking) 020 3005 5000
Andrew Raca (Corporate Finance)
Qualified Person Review
In accordance with the AIM Rules - Note for Mining and Oil and Gas Companies, this release has been reviewed by Mark Abbott, Managing Director of Egdon, who is a geoscientist with over 30 years' experience and is a member of the Petroleum Exploration Society of Great Britain and a Fellow of the Geological Society. Mr Abbott has consented to the inclusion of the technical information in this release in the form and context in which it appears.
The information contained within this announcement is deemed by the Company to constitute inside information as stipulated under the Market Abuse Regulations (EU) No. 596/2014 ("MAR"). Upon the publication of this announcement via Regulatory Information Service ("RIS"), this inside information is now considered to be in the public domain.
This information is provided by RNS, the news service of the London Stock Exchange. RNS is approved by the Financial Conduct Authority to act as a Primary Information Provider in the United Kingdom. Terms and conditions relating to the use and distribution of this information may apply. For further information, please contact firstname.lastname@example.org or visit www.rns.com.