Last checked at 14 Sep 2022 07:00
Serica Energy plc
("Serica" or "the Company")
North Eigg Drilling Update
London, 14 September 2022 - Serica Energy plc (AIM: SQZ) provides the following update on the North Eigg exploration well.
Drilling operations on the North Eigg exploration well have encountered delays and, following a recent equipment failure and the required mobilisation of a replacement (further details below), operations are now expected to take some six weeks longer to complete than the original schedule.
Operations had been progressing successfully despite some drilling delays in the top-hole sections. During recent preparations for drilling the third section of the well there was a failure of a vital piece of rig equipment during routine pre-job testing. A replacement has been sourced and planning is underway to transport this to the drilling rig.
This will have no impact on the ultimate geological outcome of the well and it is expected that all well costs will benefit from the Investment Allowances available under the recently introduced Energy Profits Levy.
Serica's net well cost after tax is anticipated to increase by approx. £3 million as a result of the delays and it is now expected that results from the well will be available in December 2022.
Mitch Flegg, Chief Executive of Serica Energy, commented:
"This high-impact exploration well is the latest in a series of capital investment projects undertaken by Serica with the objective of increasing our production in an environmentally sensitive manner. This programme is designed to help increase the UK's security of supply and reduce its reliance on imports.
The technical delays encountered on this project are extremely frustrating but do not impact either the chance of success or the significant prospective volumes of this exploration prospect."
Regulatory:
This announcement contains inside information for the purposes of article 7 of Regulation 2014/596/EU (which forms part of domestic UK law pursuant to the European Union (Withdrawal) Act 2018).
Enquiries:
Serica Energy plc | +44 (0)20 7390 0230 |
Tony Craven Walker (Chairman) / Mitch Flegg (CEO) | |
Peel Hunt (Nomad & Joint Broker) | +44 (0)20 7418 8900 |
Richard Crichton / David McKeown | |
Jefferies (Joint Broker) | +44 (0)20 7029 8000 |
Tony White / Will Soutar | |
Vigo Consulting (PR Advisor) | +44 (0)20 7390 0230 |
Patrick d'Ancona / Finlay Thomson | serica@vigoconsulting.com |
NOTES TO EDITORS
Serica Energy is a British independent oil and gas exploration and production company with a portfolio of UKCS assets.
Serica is the operator of the producing Bruce, Keith and Rhum fields in the UK Northern North Sea, holding interests of 98%, 100% and 50% respectively, and holds a 50% operated interest in the producing Columbus field in the UK Central North Sea. Serica also holds an 18% non-operated interest in the producing Erskine field in the UK Central North Sea.
Over 85% of Serica's production is natural gas, a key element in the UK's energy transition.
Further information on the Company can be found at www.serica-energy.com.
The Company's shares are traded on the AIM market of the London Stock Exchange under the ticker SQZ and the Company is a designated foreign issuer on the TSX. To receive Company news releases via email, please subscribe via the Company website.