Hurricane Energy Plc (LON:HUR) shares started the week higher as the offshore oiler struck a significant partnership deal with Spirit Energy, putting in place a new well programme to deliver its first production from a second development area in the West of Shetland region.
Funded by Spirit, the company now expects to bring the Greater Warwick Area online in 2020, a year after the early production system kicks in at the Lancaster field.
Spirit is to fund some US$387mln of Hurricane’s share of costs for an exploration and appraisal well programme, plus the development and engineering costs involved in starting up production. In return, Spirit will receive a 50% stake in GWA.
Hurricane highlighted that the deal unlocks the GWA programme and significantly means that cash flows from the Lancaster EPS can be reinvested back in the larger Lancaster field development (rather than fund exploration and appraisal activity).
"This transaction allows us to accelerate monetisation of our GWA resource base through a work programme designed to target significant reserve growth,” said Dr Robert Trice, Hurricane chief executive.
Echo Energy Plc (LON:ECHO)
Echo signed up a contractor for a 3D seismic programme across its assets in Argentina, starting with the ‘high impact, frontier scale’ Tapi Aike exploration area. The programme is due to get underway at Tapi Aike in November, to be followed by the Fraccíon C and Fraccíon D areas and it is scheduled to complete in the second quarter of 2019.
At Tapi Aike some 41 exploration leads have already been identified, typically each is presently estimated between 50bn and 600bn cubic feet of potential gas resources – with a total of 22 trillion cubic feet estimated in the ‘high case’ across the project’s whole exploration inventory.
Tapi Aike has previously been assessed by 2D seismic, and, three independent exploration plays have been observed in the existing data. New 3D seismic will be shot over 1,200 square kilometres, specifically designed to de-risk four possible exploration well locations.
Sound Energy PLC (LON:SOU)
Sound told investors it has been awarded a production concession for the Tendrara gas discovery, bringing the field development project closer to a final investment decision.
The AIM-quoted explorer said it expects to make a decision once additional key development milestones have been secured – namely, the securing of a gas sales agreement, funding and regulatory formalities.
"I am delighted with the award of the first development concession in Eastern Morocco, which is a critical step in commercialising our gas discovery,” said James Parsons, Sound Energy chief executive.
“The company continues to make excellent progress on all fronts, including FEED, the gas sales agreement and ground works at TE-9."
Sound’s new production concession is based on a proposed development programme that would involve the drilling of five new horizontal wells, plus the re-completion of the existing TE-6 and TE-7 wells. It will need a gas treatment and compression facility, as well as a 120-kilometre pipeline.
Europa Oil & Gas Holdings PLC (LON:EOG)
Europa has suffered a new disappointment in its efforts to test the Holmwood prospect, in Surrey, onshore UK.
The company, in a statement, told investors that the authorities have decided not to renew the lease for the proposed operations site at Bury Hill Wood, Coldharbour Lane. It said it was informed by the Head of Estates at the Forestry Commission, who relayed the decision made by the Minister for the Environment, Food and Rural Affairs. Accordingly, the company has now had to withdraw its planning application for the project.
Bury Hill was the planned location of the proposed Holmwood well, which, by targeting the Portland sandstone reservoir and also testing deeper Kimmeridge zones, would’ve effectively been a follow-on or ‘copy cat’ of the nearby Horse Hill discovery.
Europa is the operator at Holmwood, holding a 20% stake in the project. UK Oil & Gas Investments PLC (LON:UKOG) is the main London-listed stakeholder in Horse Hill, and, it also holds a substantial interest in Holmwood. AIM-peers Egdon Resources Plc (LON:EDR), Angus Energy Plc (LON:ANGS) and Union Jack Oil PLC (LON:UJO) are also partners in the venture.
Europa’s disappointment comes as ongoing well testing operations at Horse Hill continue to encounter issues with environmental protesters at the gates of its operations site.
Coro Energy Plc (LON:CORO)
As Coro Energy reported half-year results it reflected on the ‘transformational’ period which saw the rebooted company formed through the combination of Sound Energy’s Italian assets and Saffron Energy.
It saw a reconfiguration of the board alongside the appointment of a new chief executive and chief financial officer. The company opened an office in London and raised €16.1mln with a view to expansion in South East Asia. More recently, in the current reporting period, the company entered into its first new transaction – agreeing to acquire a 42% interest in the Bulu PSC.
James Menzies, Coro's chief executive officer, commented: "With the first transaction now signed, we are continuing to build momentum, with a pipeline of accretive deals continuing to be developed."
SOCO International Plc (LON:SIA)
SOCO agreed on an extension to the ‘long stop’ deadline for its proposed disposal of assets in Angola. The company announced in early July that a US$5mln deal to sell its SOCO Cabinda subsidiary which holds a 22% interest in the underlying Cabinda North Block onshore Angola.
The transaction deadline was previously moved to August 31, and, today Soco confirmed a further extension setting a new deadline of September 30 – allowing more time for the receipt of customary approvals needed for completion.