IOG.L Regulatory News (IOG)

17 May 2021

IOG plc

Phase 1 Duty Holder and Operations Contract

awarded to ODE Asset Management

IOG plc ("IOG", or "the Company"), (AIM: IOG.L), the UK gas company targeting growth and high returns via an infrastructure-led hub strategy, is pleased to announce that, as operator of its joint venture (JV) with CalEnergy Resources (UK) Limited (CER), it has awarded the Phase 1 Duty Holder contract for Installation and Pipeline Operator, as well as facilities operations and maintenance (O&M), to ODE Asset Management (ODE AM).

Working closely with IOG's in-house operations team, ODE AM will be responsible for delivering safe, efficient and cost-effective production operations from the JV's Phase 1 offshore infrastructure in the UK Southern North Sea (SNS), including the Blythe and Southwark platforms, the Thames Pipeline and the associated subsea connector lines.

ODE AM will also provide O&M and integrated services for Phase 1, including the onshore control room at the Bacton Gas Terminal, travel, training and crew for offshore activities, emergency response, warehousing and quayside support, and all associated regulatory interface and compliance. The contract has mechanisms to incentivise ODE AM to maximise operating efficiencies and an appropriate risk-reward formula for performance against agreed criteria.

ODE AM has an extensive SNS track record, including as Duty Holder for the Tolmount gas platform on behalf of Humber Gathering System Limited (the Kellas Midstream and Dana Petroleum JV) and Installation and Pipeline Operator for the producing Babbage gas field on behalf of NEO Energy.

This award further cements a relationship that started in early 2018 with ODE AM's appointment as Pipeline Operator for the Thames Pipeline (PL370), since when it has provided pre-operations services on a reimbursable basis. The wider ODE Group is also undertaking engineering, procurement, construction and installation activities for the ongoing recommissioning of the JV's onshore Thames Reception Facilities at Bacton.

Andrew Hockey, CEO of IOG, commented: 

"We are pleased to award this contract to ODE AM, who have a well-established Duty Holder and O&M track record in Southern North Sea gas projects including Babbage and Tolmount. Their focus on safe, efficient and cost-effective operations will be integral to our low opex and low carbon intensity production model. We look forward to continuing our collaboration with ODE AM as we ramp up pre-operations and commissioning activities ahead of First Gas in late Q3 this year."

Sandy Reid, Managing Director of ODE AM, said:

"We're delighted to continue our support to IOG on their prestigious Core Project and be appointed Duty Holder for the Blythe and Southwark offshore facilities. This contract fully aligns and incentivises ODE AM to support IOG in what both parties see as an operating partnership to deliver industry leading lifting cost and low carbon performance. We're proud that IOG are placing their trust in the wider capabilities of the ODE Group to safely deliver both the Bacton EPCI and the offshore Duty Holder scopes."

This announcement contains inside information for the purposes of Article 7 of the Market Abuse Regulation (EU) 596/2014 as it forms part of UK domestic law by virtue of the European Union (Withdrawal) Act 2018 ("MAR"), and is disclosed in accordance with the company's obligations under Article 17 of MAR.

Enquiries:

About IOG:

IOG owns and operates a 50% stake in substantial low risk, high value gas reserves in the UK Southern North Sea. The Company's Core Project targets a gross 2P peak production rate of 140 MMcfe/d (c. 24,000 Boe/d) from gross 2P gas reserves of 302 Bcfe¹ and management estimated 2C gas Contingent Resources of 132 Bcfe, via an efficient hub strategy based on co-owned infrastructure. In addition to its 2P reserves at Blythe, Elgood, Southwark, Nailsworth and Elland and 2C contingent resources at Goddard, it has management estimated gross 2C contingent resources of 23 Bcfe at Abbeydale and unrisked mid-case prospective resources of 66 Bcfe at Thornbridge, 31 Bcfe at Southsea, 31 Bcfe at Kelham, 27 Bcfe and 16 Bcfe in the two Goddard flank structures, and 21 Bcfe at Harvey. In December 2020 IOG also accepted a 50% operated stake in Licence P2589, containing the Panther and Grafton gas discoveries with management estimated gross mid-case contingent resources of 46 Bcfe and 35 Bcfe respectively. In addition IOG continues to pursue value accretive acquisitions to help generate significant shareholder returns.

1ERC Equipoise Competent Persons Report: October 2017, adjusted by Management to account for updated project timing and compression

About ODE Asset Management:

ODE AM specialises in operations and maintenance, integrity management and full Duty Holder responsibilities for both Installation and Pipeline Operatorship. It is a subsidiary of ODE Group, an international technical service provider to the oil, gas and renewable energy markets, which in turn is part of the globally renowned DORIS Group. With over 50 years' experience, ODE Group provides comprehensive consulting, engineering, procurement, project management and operations support services to the oil, gas and renewable energy sectors.

ODE Group operations include headquarters in London, with other UK based offices in Aberdeen and Great Yarmouth. International operations incorporate subsidiary / branch offices and dependencies in Taipei, Tokyo, Hanoi, Seoul, Paris, Hamburg, Denver and Boston. ODE AM's operations in Aberdeen and Great Yarmouth benefit from a strong capability in brownfield engineering and associated specialised integrity fabric maintenance activities from ODE's integrated engineering resource base. These activities extend to both offshore and associated onshore reception facilities.