Deltic Energy PLC (AIM:DELT) has been provisionally awarded two new licences in the North Sea in the latest tranche of new licences issued by the UK government.
The AIM-listed firm has landed some 226 square kilometers of acreage, landing three part blocks in the Central North Sea.
It includes the Dewar and, separately, an extension area contiguous to the company’s existing exploration partnership with Shell (which received acreage in the first tranche of the licensing).
A third tranche of licence awards is still outstanding and Deltic noted that it is expected to comprise licence awards in the Southern North Sea – which was "the focus of Deltic’s licence application efforts".
"These provisional awards are a direct result of the hard work that our technical team put into the application process and we look forward to announcement of Southern North Sea Tranche 3 awards in due course,” chief executive Graham Swindells said in a statement.
“The blocks awarded to date have the potential to further diversify our asset base and provide optionality within our portfolio.
“Deltic is committed to exploration within the UK and a regular, predictable licensing process remains critical to maintaining domestic gas production, supporting jobs and delivering energy security."
The expansion of Deltic’s portfolio comes as the company’s exploration partnership with Shell continues to progress, adding value as they follow up the Pensacola discovery which was one of the best new finds in the hydrocarbon province for several years.
In January, Pensacola was confirmed as a “regionally significant” discovery in the Southern North Sea, in an independent report.
That report featured a maiden Contingent Resource estimate for the Pensacola Zechstein Reef discovery – with ‘in-place’ resources coming in at 326 million barrels of oil equivalent. RPS ascribed up to 21.8 million barrels of the higher confidence contingent resource for Deltic’s 30% stake in the project.
Shell is meanwhile advancing plans for the Pensacola project; an appraisal well will be drilled later this year, which if successful will move the project towards development.
Another exploration well, on the Selene prospect, is also on the slate for the Shell partnership in 2024.
Deltic, meanwhile, continues to work on a number of potential options to realise value and mitigate exposure to future expenditures at Pensacola and the Selene project.
A farm-out process has received “a significant level of interest”, the company highlighted.