CLNR, the natural resources investing company, is pleased to announce a significant increase in P50 Prospective Resources on its 100% owned Licence P2252 from 162 BCF to 636 BCF following technical work focussing on the Zechstein prospects located in the Southern North Sea. This increase is primarily due to the newly named Pensacola Prospect, which the Company estimates to have P50 Prospective Resources of 424 BCF, providing significant exploration upside potential on the licence.
Algy Cluff, Chief Executive & Chairman commented:
“We are delighted that our continued technical focus on these core licences continues to de-risk known gas prospects and enhance the exploration upside contained within the portfolio. The Company has a 100% equity position in its highly prospective licences in the Southern North Sea which deserve to be fully appraised. We are confident that the quality and scale of these assets will continue to attract the interest of existing operators and potential new entrants as we progress through the farm-out process.”
Further Information on Licence P2252
Technical work focussing on the Zechstein prospects located on Licence P2252 has been completed in conjunction with the Company's retained sub-surface consultants, Lyme Bay Consulting. This work, which was based on reprocessed geophysical datasets not available at the time of the Company's initial Competent Person's Report released in December 2015, has resulted in a significant resource upgrade on the Lytham and Fairhaven prospects and highlighted major exploration upside potential in the form of a Zechstein reef build-up (‘the Pensacola Prospect'), similar to those indicated at the nearby Crosgan discovery and the Ossian and Aurora prospects. This work has resulted in the P50 Prospective Resources associated with the prospects on this block being increased from 162 BCF to 636 BCF.
he acquisition of recently reprocessed 3-D seismic has provided a greater level of confidence in the mapping of the Lytham and Fairhaven Zechstein (Fractured Hauptdolomite) Prospects where previous exploration wells by third parties indicated significantly elevated levels of gas during drilling operations. This revised mapping and comparison with close analogues within the basin, such as the giant Hewett Field, has allowed a revised assessment of the estimated gas volumes associated with these structures which has increased the combined P50 Prospective Resources on this prospect from 94 BCF to 168 BCF.
Additionally, the new 3-D seismic data set has also allowed for a revised interpretation of the St. Annes lead highlighted previously. It is now believed that these leads form the outer edge of a larger circular patch reef complex, now named the Pensacola Prospect, similar to those seen on adjacent blocks to the east. These patch reefs are analogous to producing fields in Poland and the US and have the potential to contain significant gas volumes and high quality reservoirs. The Company estimates that the Pensacola Prospect has P50 Prospective Resources of 424 BCF between the reef margin which has the potential to contain high quality reservoir facies and the internal lagoon sediments which are potentially more variable in terms of overall reservoir quality.
Completion of a seismic inversion process on the 3-D dataset for Licence P2252, in conjunction with Halliburton, has indicated the likely presence of a high density North-South oriented fracture network across the Lytham structure, which should enhance the reservoir properties and production characteristics of the prospect. Work continues on the outline design and likely production characteristics of the appraisal well required to test the commercial viability of this prospect.
Update on Option over North Sea Oil Licences
On 10 May 2016 the Company announced that it had entered into a sale and purchase agreement (‘SPA') with Verus Petroleum (SNS) Limited (‘Verus') in connection with the purchase of a 5% participating interest in UKCS licences P1944 (Block 14/20e) and P2156 (Block 15/11 & 16f) located in the Outer Moray Firth which contain the Fynn and Penny prospects. The consideration was £1 and completion of the acquisition of that interest was subject to various approvals. In addition, an exclusive option was granted by Verus in favour of the Company over its remaining 20% participating interest in these licences (the ‘Option'). As the necessary approvals to allow the acquisition of the 5% participating interest under SPA to be completed have not yet been received, the Company has decided to exercise its right to terminate the SPA in regards to the 5% participating interest and the parties have instead contemporaneously expanded the Option from a 20% to a 25% participating interest in each of the licences, on the same terms as previously disclosed.