REG - IOG PLC - Phase 1 Progress

IogAnnouncement

21/02/2022 07:00

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RNS Number : 2083C  IOG PLC  21 February 2022

21 February 2022

 

IOG plc

 

Phase 1 Progress

 

IOG plc ("IOG", or "the Company"), (AIM: IOG.L), the Net Zero UK gas and
infrastructure operator focused on high return projects, provides the
following operational update.

 

Andrew Hockey, CEO of IOG, commented:

 

"The IOG leadership team attended Bacton terminal late last week to go through
a Pre-Start Up Safety Review ahead of final Saturn Banks commissioning.
Terminal operator Perenco, executing works on IOG's behalf, advised us that
the current stormy weather has hampered the final construction and leak
testing programme with a knock-on impact on commissioning of the safety
instrumentation systems.  As a result the plant will likely not be ready to
start backgassing until the week beginning 28(th) February, with First Gas
from both Blythe and Elgood around a week later. Albeit frustrating, this
delay facilitates a safe and reliable start-up."

 

Saturn Banks Reception Facilities (SBRF), Backgassing and First Gas

 

SBRF preparation for First Gas is now 99% complete. IOG senior management
attended a final Pre-Start Up Safety Review and inspected the facilities on
Thursday 17 February as part of pre-completion assurance. Final
pre-commissioning checks and cause-and-effect function testing and final
construction activities continue to be undertaken, albeit severe weather from
the named storms passing over the UK  has been hindering progress with
further stormy weather likely to impact crane lifting operations. Once the
terminal operator Perenco UK Limited (PUK), the Company and its pipeline duty
holder ODE Asset Management (ODEAM) have fully signed off the onshore
facilities to safely introduce hydrocarbons, then backgassing operations can
commence. This is now targeted for the week beginning 28(th) February, with
First Gas expected to occur approximately a week later. The unsettled weather
may also potentially impede the operations required at the Blythe platform as
part of the backgassing and start-up procedures, although the bulk of this
work is now complete. As a result of a planned inspection the UK Health and
Safety Executive have raised a number of clarifications required to be
resolved ahead of start-up and this is being addressed.

 

Southwark

 

In parallel, the Company has continued to progress suitable options for a
timely and safe return to Southwark drilling, after unstable conditions due to
seabed scouring forced operations to be suspended in January. During February
to date the forward plan has been defined with the assistance of subject
matter experts and agreed with the rig owner. This essentially entails
creating pads on the seabed with suitable sized rocks to enable stable
positioning of the rig spud cans. This solution is now being expedited with
drilling expected to be resumed at Southwark in March subject to completion of
the necessary regulatory approvals and commercial processes.

 

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's Saturn Banks Project targets a gross peak production rate of 140 mmscf/d
(c. 24,000 Boe/d) from gross 2P gas reserves of 302 Bcfe¹ and management
estimated 2C gas Contingent Resources of 132 Bcfe, via an efficient hub
strategy based on co-owned infrastructure. In addition to its 2P reserves at
Blythe, Elgood, Southwark, Nailsworth and Elland and 2C contingent resources
at Goddard, it has management estimated gross 2C contingent resources of 23
Bcfe at Abbeydale and gross unrisked mid-case prospective resources of 36 Bcfe
at Kelham North, 42 Bcfe at Kelham Central, 58 Bcfe at Thornbridge, 31 Bcfe at
Southsea, 28 Bcfe and 19 Bcfe in the two Goddard flank structures. The Orrell
discovery, with management estimated gross 2C contingent resources of 42 Bcfe,
also lies approximately 50% on the P2442 licence held 50% by IOG. IOG also
holds a 50% operated stake in Licence P2589, containing the Panther and
Grafton gas discoveries with management estimated gross mid-case contingent
resources of 46 Bcfe and 35 Bcfe respectively. In addition, IOG continues to
pursue value accretive acquisitions to help generate further significant
shareholder returns.

¹ERC Equipoise Competent Persons Report: October 2017, adjusted by Management
to account for updated project timing and compression

 

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