REG - IOG PLC - Phase 1 First Gas

IogAnnouncement

14/03/2022 07:00

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RNS Number : 5897E  IOG PLC  14 March 2022

14 March 2022

 

IOG plc

 

Phase 1 First Gas

 

IOG plc ("IOG", or "the Company"), (AIM: IOG.L), the Net Zero UK gas and
infrastructure operator focused on high return projects, is pleased to confirm
First Gas from Phase 1 of its Saturn Banks Project.

 

IOG has released a new video to mark this milestone:
https://youtu.be/kZBzzm01M8g (https://youtu.be/kZBzzm01M8g) .

 

Andrew Hockey, CEO of IOG, commented:

 

"I am delighted to confirm that Saturn Banks Phase 1 First Gas has been
achieved. Yesterday the Blythe well was safely opened up and IOG gas has
started to be delivered into Bacton and on into the UK market. The Elgood well
is expected to follow in the next two days.

 

I am immensely grateful to the whole IOG team for their determined efforts to
achieve this major target. My sincere thanks also go to our joint venture
partner CalEnergy Resources and their owner Berkshire Hathaway Energy, to all
our shareholders and bond investors, as well as to our many contractors,
commercial partners and regulators.

 

Phase 1 First Gas is just the first step on a bigger journey, giving us the
operational platform and financial capacity to deliver multiple further phases
of growth. By delivering domestic gas supplies through our co-owned
infrastructure on a Scope 1 and 2 Net Zero basis we can generate strong and
sustainable returns for shareholders."

 

Fiona MacAulay, Chair of IOG, commented:

 

"I am hugely proud of everyone in our team for overcoming the many challenges
to deliver this historic milestone, going from Final Investment Decision to
first production in under two and a half years. Through constructive
collaboration, guided by our values of resourcefulness, innovation, drive,
efficiency, resilience and safety, we have transformed IOG from an unfunded
start-up to a gas producer expected to generate significant cashflow this year
and into the future.

 

With heightened energy security risks across Europe and the continued urgency
of the energy transition, there has never been a more important time to bring
new UK gas resources onstream. This is especially true of IOG's gas which has
far lower carbon intensity than imports."

 

Alistair Macfarlane, Area Manager - Southern North Sea and East Irish Sea at
the Oil and Gas Authority, said:

 

"As the UK transitions to net zero it will need a stable and secure supply of
domestic gas to reduce its reliance on imports, which often have a larger
carbon footprint, and so first production from the Saturn Banks project is a
positive development."

 

Phase 1 First Gas

 

After final commissioning of the Saturn Banks Reception Facilities (SBRF) at
Bacton terminal, backgassing of the pipeline system was successfully completed
over the past week. This enabled the planned start-up sequence, with Blythe
the first well to be opened up and forward flow commencing into the SBRF on
Sunday 13 March. The Elgood well is planned to start up in the next two days
and an initial view on flow rates will be assessed once stable production has
been established from both fields. The Company intends to analyse reservoir
performance data over the initial months of production to inform an annual
production guidance range.

 

The entire Saturn Banks offshore system, including the platforms, pipelines,
associated subsea equipment and production wells, will be normally unmanned
with remote operation from the control room at Bacton terminal, helping to
minimise operating costs and carbon intensity over time.

 

2021 Results

 

The Company expects to release its Final Audited 2021 Results and a full
portfolio technical update on Thursday 17 March.

 

This announcement contains inside information for the purposes of Article 7 of
the Market Abuse Regulation (EU) 596/2014 as it forms part of UK domestic law
by virtue of the European Union (Withdrawal) Act 2018 ("MAR"), and is
disclosed in accordance with the company's obligations under Article 17 of
MAR.

 

Enquiries:

 

 IOG plc                                            +44 (0) 20 7036 1400

 Andrew Hockey (CEO)

 Rupert Newall (CFO)

 James Chance (Head of Capital Markets & ESG)

 finnCap Ltd                                        +44 (0) 20 7220 0500

 Christopher Raggett / Simon Hicks

 Peel Hunt LLP                                      +44 (0) 20 7418 8900

 Richard Crichton / David McKeown

 Vigo Consulting                                    +44 (0) 20 7390 0230

 Patrick d'Ancona / Chris McMahon / Oliver Clark

About IOG:

 

IOG is a Net Zero UK gas and infrastructure operator focused on high-return
projects. The Company's operations are currently concentrated around its
offshore and onshore Saturn Banks infrastructure in the UK Southern North Sea.
Phase 1 of its Saturn Banks Project, which started production in March 2022,
entails the commercialisation of the Blythe, Elgood and Southwark gas fields
through this infrastructure. Phase 2 of the Saturn Banks Project entails the
Nailsworth, Goddard and Elland gas discoveries, which are subject to future
investment decisions and expected to be commercialised through the same export
infrastructure. The Company also holds further licences with additional assets
including the Abbeydale, Panther and Grafton gas discoveries, the Kelham
North, Kelham Central, Thornbridge and Thornbridge Deep prospects, and part of
the Orrell gas discovery. Currently, all IOG's licences are held 50:50 with
its joint venture partner CalEnergy Resources (UK) Limited and operated by
IOG. In addition, the Company continually evaluates further opportunities for
accretive portfolio additions to help generate additional shareholder returns.
Further details are available at www.iog.co.uk (http://www.iog.co.uk) .

 

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