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Deltic Energy expands North Sea footprint landing acreage in UK licensing round

The new acreage is described as “highly prospective”, containing a variety of exploration plays

Deltic Energy PLC - Deltic Energy expands North Sea footprint landing acreage in UK licensing round

Deltic Energy PLC (LON:DELT) has significantly expanded its footprint in the Southern and Central North Sea, landing six awards in the UK government’s latest offshore licensing round.

The company said it has been provisionally awarded six licences, covering twelve full and part blocks, which span a total of 2,155.5 square kilometres.

"The UK's Offshore Licensing system remains an ideal way to access high quality acreage in a proven hydrocarbon province and we are delighted to have been provisionally awarded these additional 6 licences which doubles the number of licences in our portfolio from 7 to 13,” Graham Swindells, Deltic chief executive said in a statement.

READ: Deltic interims boast strong balance sheet

One of the six awards is in tandem with existing exploration partner Royal Dutch Shell, with Deltic holding 30% and Shell owning 70%. The other five are 100% held by Deltic.

Significantly, the joint venture acreage is believed to host extensions of the Pensacola Reef prospect, as imaging of the area was captured in recently acquired 3D seismic data.

In today’s separate interim financial results statement Deltic confirmed that its exploration venture with Shell remains on-track for a well commitment decision, for Pensacola, later this year ahead of a possible well in 2021.

Deltic, meanwhile, described all the new acreage as “highly prospective” with a variety of exploration plays.

It is expecting the additional will significantly enhance both the pipeline of potential drilling opportunities and the overall prospective resources in the portfolio, as prospects within these areas are matured during the initial term of the licences.

Among the awards, the company regains the Cadence structure (in Blocks 43/11 and 43/12b) which is said to be of ‘Trillion Cubic Feet (TCF) scale, immediately north of Spirit Energy’s Pegasus development.

Other new licences are located in a proven gas-bearing area immediately to the South and South East of the Breagh gas field.

And in the Central North Sea area the company gains acreage hosting two known prospects, identified by former licence holders, in which Deltic sees significant upside potential.

Swindells added: “We are particularly pleased to have been re-awarded block 43/11 (formerly licence P2248) which contains the exciting Cadence prospect and to have been successful in our joint application with Shell over the area surrounding Pensacola.

“The licences awarded contain high quality prospects which can be rapidly matured and greenfield exploration opportunities which substantially diversifies the company's portfolio and have the potential to provide multiple new drilling opportunities over the coming years. With further evaluation we expect these awards to substantially increase the oil and gas resource base held by the company."

Quick facts: Deltic Energy PLC

Price: 0.9 GBX

AIM:DELT
Market: AIM
Market Cap: £12.65 m
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Deltic Energy doubles number of licenses in portfolio with six new deals

Deltic Energy PLC's (LON:DELT) Graham Swindells speaks to Proactive London after landing six awards in the UK government’s latest offshore licensing round. These provisionally awarded 6 new licences nearly doubles the number of licences in the portfolio from 7 to 13. One of the six awards is in...

on 4/9/20

3 min read