REG - Deltic Energy PLC - Selene Drilling Operations – Rig Mobilisation

Deltic EnergyAnnouncement

23/07/2024 07:00

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RNS Number : 3528X  Deltic Energy PLC  23 July 2024

 

Deltic Energy Plc / Index: AIM / Epic: DELT / Sector: Natural Resources

 

23 July 2024

 

 

Deltic Energy Plc ("Deltic" or "the Company")

Selene Drilling Operations - Rig Mobilisation

 

Deltic Energy Plc (https://delticenergy.com/) , the AIM quoted natural
resources investing company with a high impact exploration and appraisal
portfolio focused on the Southern and Central North Sea, is pleased to
announce that the Valaris 123 drilling unit has been mobilised and is on route
to the Selene well location.

 

Shell UK Ltd ("Shell"), in its role as Operator of Licence P2437, has informed
Deltic that the Valaris 123 drilling unit was mobilised on 21 July from its
current location in the Central North Sea, and is anticipated to arrive at the
Selene well location in the Southern North Sea shortly, depending on weather
conditions encountered during transit. Drilling operations are expected to
commence shortly thereafter, with planned operations lasting approximately 90
days. The Company will make a further announcement once drilling has
commenced.

 

The well is designed to collect all key information in relation to reservoir
quality and gas composition that is required to support, assuming a successful
drilling outcome, a field development plan and final investment decision on
the potential development of the Selene gas field without the requirement for
a further appraisal well. The Joint Venture has therefore determined there is
no requirement for a full well test as part of that process and, in line with
normal oilfield practice, the well will accordingly be plugged and abandoned
on completion.

 

Deltic estimates the Selene structure to contain gross P50 prospective
resources of 318 BCF (P90-P10 Range of 132-581 BCF with GCoS of 69%) in the
Leman Sandstone reservoir, which is the key reservoir interval in all adjacent
gas fields including Barque, Clipper and West Sole.

 

Following farm-outs to Shell in 2019 and Dana Petroleum (E&P) Limited
("Dana") in February 2024, Deltic is fully carried for its 25% working
interest in the Selene well up to a gross success case well cost of USD$49M,
which is in excess of the Operator's success case well Authorisation for
Expenditure of USD$47M.

 

Graham Swindells, CEO of Deltic, commented:

 

"We are excited to be commencing drilling operations on Selene with our
partners Shell and Dana, and for which we are fully carried for the estimated
success case cost. This will be the first exploration well spudded on the UKCS
in 2024 and is an equally important milestone for Deltic. The Selene prospect
is a high impact infrastructure-led exploration opportunity which demonstrates
the strength and depth of the portfolio that we have built over the last few
years, and which we estimate to be worth multiples of the Company's current
market value. Despite ongoing political uncertainty, we look forward to
commencing operations and continue to believe exploration on the UKCS has a
hugely important role to play in supporting the provision of energy security,
vital jobs within the energy sector and offsetting higher carbon intensity
imported energy."

 

**ENDS**

 

For further information please contact the following:

 

 Deltic Energy Plc                                                              Tel: +44 (0) 20 7887 2630

 Graham Swindells / Andrew Nunn / Sarah McLeod

 Allenby Capital Limited (Nominated Adviser)                                    Tel: +44 (0) 20 3328 5656
 David Hart / Alex Brearley (Corporate Finance)

 Stifel Nicolaus Europe Limited (Joint Broker)                                  Tel: +44 (0) 20 7710 7600

 Callum Stewart / Simon Mensley / Ashton Clanfield

 Canaccord Genuity Limited (Joint Broker)                                       Tel: +44 (0) 20 7523 8000

 Adam James / Ana Ercegovic

 Vigo Consulting (IR Adviser)                                                   Tel: +44 (0) 20 7390 0230

 Patrick d'Ancona / Finlay Thomson / Kendall Hill

 

Reporting Standard

Estimates of resources have been prepared in accordance with the PRMS as the
standard for classification and reporting.

 

Qualified Person's Review

Andrew Nunn, a Chartered Geologist and Chief Operating Officer of Deltic, is a
"Qualified Person" in accordance with the Guidance Note for Mining, Oil and
Gas Companies, June 2009 as updated 21 July 2019, of the London Stock
Exchange. Andrew has reviewed and approved the information contained within
this announcement.

 

Glossary of Technical Terms

 

 BCF:                                  Billion Cubic Feet

 Geological Chance of Success (GCoS):  or prospective resources, means the chance or probability of discovering
                                       hydrocarbons in sufficient quantity for them to be tested to the surface.
                                       This, then, is the chance or probability of the prospective resource maturing
                                       into a contingent resource. Prospective resources have both an associated
                                       chance of discovery (geological chance of success) and a chance of development
                                       (economic, regulatory, market and facility, corporate commitment and political
                                       risks). The chance of commerciality is the product of these two risk
                                       components. These estimates have been risked for chance of discovery but not
                                       for chance of development.

 P90 resource:                         reflects a volume estimate that, assuming the accumulation is developed, there
                                       is a 90% probability that the quantities actually recovered will equal or
                                       exceed the estimate.  This is therefore a low estimate of resource.

 P50 resource:                         reflects a volume estimate that, assuming the accumulation is developed, there
                                       is a 50% probability that the quantities actually recovered will equal or
                                       exceed the estimate.  This is therefore a median or best case estimate of
                                       resource.

 P10 resource:                         reflects a volume estimate that, assuming the accumulation is developed, there
                                       is a 10% probability that the quantities actually recovered will equal or
                                       exceed the estimate.  This is therefore a high estimate of resource.

 PRMS:                                 the June 2018 Society of Petroleum Engineers ("SPE") Petroleum Resources
                                       Management System

 Prospective Resources:                are estimated volumes associated with undiscovered accumulations. These
                                       represent quantities of petroleum which are estimated, as of a given date, to
                                       be potentially recoverable from oil and gas deposits identified on the basis
                                       of indirect evidence but which have not yet been drilled

 

 

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