Egdon Resources has announced that it has signed an exclusivity agreement with a large internationally recognised exploration and production company in respect of its P1929 and P2304 licences in the UK Southern North Sea, which contain the Resolution and Endeavour gas discoveries. Resolution has been independently assessed to hold mean Contingent Gas Resources of 231bcf in the Zechstein reservoir.
Resolution has been independently assessed to hold mean Contingent Gas Resources of 231bcf in the Zechstein reservoir. We value Resolution at 7.1p/share, though significant uncertainty remains regarding commerciality ahead of 3D seismic and an appraisal well. The exclusivity agreement is subject to a farm out agreement being entered into by 19 January 2020 and completion occurring by 19 April 2020.
Egdon also responded to the government announcement that it will introduce a temporary moratorium on hydraulic fracturing for shale gas. Egdon’s unconventional resources acreage position sits in the Gainsborough Trough in Eastern England. The Springs Road-1 well indicates gas in place of 640 bcf per square mile and and the site and basin is characterised by its simple structure and limited faulting.
Author: Elaine Reynolds