01 February 2024
Orcadian Energy
plc
("Orcadian Energy",
"Orcadian" or the "Company")
33rd Licensing
Round Offer of Awards
Highlights
Orcadian Energy is delighted to
report that NSTA has announced the offer of a further tranche of
licence awards in the 33rd Round.
NSTA has confirmed, in an
announcement dated 31 January 2024, that Orcadian Energy will be
offered two licences in the Central North Sea ("CNS") one in
partnership with Parkmead Group, and the other in partnership with
Triangle Energy. Orcadian anticipates that these licences will be
formally issued within the next three months.
Mid-North Sea High Licence
The Mid-North Sea High
("MNSH") licence contains
shallow gas prospects and leads which contain up to 336 bcf of
gross prospective recoverable resource on a P50 basis, this
estimate is an Orcadian management estimate, which is provided for
guidance only, and was submitted in the licence application. The
two largest prospects - Glenlough and Breckagh - are estimated to
account for about 80% of the identified resource potential.
Orcadian applied in partnership with Triangle Energy, an Australian
listed energy company. Orcadian would be licence administrator and
would hold 50% of the offered licence.
The Mid-North Sea licence covers
blocks 29/16, 29/17, 29/18, 29/19, 29/21, 29/22, 29/23, 29/27 and
29/28.
Fynn Licence
The Fynn licence contains a very
substantial heavy oil discovery which has a gross P50 contingent
recoverable resource of 292 MMbbl, based upon the latest internal
estimates as presented to NSTA by Parkmead (E&P) Limited, the
proposed operator. About 88% of the resource on a best technical
case is estimated to lie within the area of the offered
licence.
Orcadian has been offered a 50%
working interest in the Fynn licence to be operated by the Parkmead
Group. The Fynn licence covers blocks 14/15a, 14/20d and
15/11a.
As announced on 19 January 2023, the
Company made three licence applications, two of which are described
above. The third area applied for, which was in the Southern North
Sea, has not been offered for award in this tranche but it is
anticipated it will be considered in a future tranche, and further
announcements will be made as appropriate.
Resource Update
As a result of the above licence
awards and based upon the assumption that the planned disposal of
an 81.25% interest in P2244 completes before 31 March 2024,
Orcadian management's latest view of the Company's resources is set
out below.
Resource estimates comprise the
current Sproule CPR for Pilot, Elke, Narwhal and the Elke
satellites; and for the remainder the estimates are management or
operator estimates as submitted to NSTA in the licence
applications. Prospective resources are only included for the
high-graded leads and prospects: Clover, Breckagh, Glenlough and QI
(quantitative interpretation) geophysically supported Elke
satellites.
1. Orcadian's Current Resource Estimate
(adjusted for the proposed disposal of Pilot and the TGS
royalty).
|
Gross
|
Net
Attributable
|
Licence
|
Operator
|
Key Discoveries or
Prospects
|
Gross 2P
Reserves
MMboe
|
Gross 2C Contingent Resources
(On hold)
MMboe
|
Gross 2C Contingent Resources
(Technical)
MMboe
|
Gross 2U Prospective
Resources (Unrisked)
MMboe
|
Net 2P
Reserves
MMboe
|
Net 2C Contingent Resources
(On hold)
MMboe
|
Net 2C Contingent Resources
(Technical)
MMboe
|
Net 2U Prospective Resources
(Unrisked)
MMboe
|
Oil
& Liquids reserves per asset
|
P2244
|
Ping
|
Pilot Main
and Pilot South
|
78.8
|
-
|
13.0
|
-
|
14.6*
|
-
|
2.4*
|
-
|
P2482
|
Orcadian
|
Narwhal,
Elke, & selected Elke satellites
|
-
|
52.7
|
2.0
|
52.6
|
-
|
52.2
|
2.0
|
52.1
|
Total for Oil and
Liquids
|
78.8
|
52.7
|
15.0
|
52.6
|
14.6
|
52.2
|
4.4
|
52.1
|
Source: Sproule
*assuming completion of the proposed
disposal of the Pilot project so that Orcadian's interest is
reduced to 18.75%.
2. Management Internal Estimates of
resources contained in the new licences offered for award by the
NSTA today
The below is compiled using the
estimates submitted to the NSTA, but the numbers have not been
independently audited and accordingly are provided for guidance
purposes only and should not be relied upon.
|
Gross (On
blocks)
|
Net
Attributable
|
Licence
|
Operator
|
Key Discoveries or
Prospects
|
Gross 2P
Reserves
MMboe
|
Gross 2C Contingent Resources
(On hold)
MMboe
|
Gross 2C Contingent Resources
(Technical)
MMboe
|
Gross 2U Prospective
Resources (Unrisked)
MMboe
|
Net 2P
Reserves
MMboe
|
Net 2C Contingent Resources
(On hold)
MMboe
|
Net 2C Contingent Resources
(Technical)
MMboe
|
Net 2U Prospective Resources
(Unrisked)
MMboe
|
Oil
& Liquids resources per asset
|
Fynn
|
Parkmead
|
Fynn
(Beauly)
|
-
|
-
|
257.2
|
-
|
-
|
-
|
128.6
|
-
|
Total for Oil and
Liquids
|
-
|
-
|
257.2
|
-
|
|
-
|
128.6
|
-
|
Gas
resources per asset (each bcf of gas is converted to MMboe by
dividing by 6)
|
MNSH
|
Orcadian
|
Glenlough
& Breckagh
|
|
-
|
-
|
44.8
|
-
|
-
|
-
|
22.4
|
Total
|
-
|
-
|
257.2
|
44.8
|
-
|
-
|
128.6
|
22.4
|
Source: Estimates. Not independently
audited.
Steve Brown, Orcadian's CEO, said:
"We are delighted that NSTA has announced these offers of
licence awards. Our strategy has been to licence or acquire
discoveries and compelling prospects, and then to farm-out an
interest in the licence to finance exploration drilling or, best of
all, development. We will build upon that strategy which has been
validated by the signing of a sale and purchase agreement for the
Pilot field with Ping Petroleum, a deal which we are on track to
complete by the end of March 2024*.
"We are excited to work with our partners Parkmead and
Triangle. With Parkmead, our focus will be on designing a work
programme to unlock the potentially very significant resource base
in Fynn; and with Triangle we will be working to transform the
leads on the Mid North Sea High licence into prospects which can be
drilled, likely at a relatively low cost as the gas prospects are
so shallow."
* completion is subject to
satisfaction of the conditions precedent set out in the
announcement dated 7 December 2023
For further information on the
Company please visit the Company's website:
https://orcadian.energy
Qualified Person's Statement
Pursuant to the requirements of the
AIM Rules and in particular, the AIM Note for Mining and Oil and
Gas Companies, Maurice Bamford has reviewed and approved the
technical information and resource reporting contained in this
announcement. Maurice has more than 33 years' experience in the oil
& gas industry and 3 years in academia. He holds a BSc in
Geology from Queens University Belfast and a PhD in Geology from
the National University of Ireland. Maurice is a Fellow of the
Geological Society, London, and a member of the Geoscience Energy
Society of Great Britain. He is Exploration and Geoscience Manager
at Orcadian Energy.
Contact:
Orcadian Energy plc
|
+ 44 20 7920 3150
|
Steve Brown, CEO
Alan Hume, CFO
|
|
WH
Ireland (Nomad and
Broker)
|
+44 20 7220 1666
|
Katy Mitchell / Andrew de Andrade
(Nomad)
Harry Ansell / Fraser Marshall
(Corporate Broking)
|
|
Tavistock (PR)
|
+ 44 20 7920 3150
|
Nick Elwes / Simon Hudson
|
orcadian@tavistock.co.uk
|
About Orcadian Energy
Orcadian is a North Sea focused, low emissions, oil and gas development
company. In planning its Pilot development,
Orcadian has selected wind power to transform oil production into a
cleaner and greener process. The Pilot project is moving towards
approval and will be amongst the lowest carbon emitting oil
production facilities in the world, despite being a viscous crude.
Orcadian may be a small operator, but it is also nimble, and the
Directors believe it has grasped opportunities that have eluded
some of the much bigger companies. As we strike a balance between
Net Zero and a sustainable energy supply, Orcadian intends to play
its part to minimise the cost of Net Zero and to deliver reliable
energy to the UK.
Orcadian Energy (CNS) Ltd,
Orcadian's operating subsidiary, was founded in 2014 and is the
sole licensee of P2244, which contains 78.0 MMbbl of 2P Reserves in
the Pilot discovery, and of P2482, which contain a further 52.2
MMbbl of 2C Contingent Resources in the Elke and Narwhal
discoveries (as audited by Sproule, with both numbers modified to
take into account the TGS royalty, see the CPR in the Company's
Admission Document for more details). Within these licences there
are also 118 MMbbl of unrisked Prospective Resources (modified for
TGS royalty). These licences are in blocks 21/27a, 28/2a and 28/3a,
and lie 150 kms due East of Aberdeen.
Pilot, which is the field with the
largest reserves in Orcadian's portfolio, was discovered by
PetroFina in 1989 and has been well appraised. In total five wells
and two sidetracks were drilled on Pilot, including a relatively
short horizontal well which produced over 1,800 bbls/day on test.
Orcadian's proposed low emissions, field development plan for Pilot
is based upon a Floating Production Storage and Offloading vessel
(FPSO), with over thirty wells to be drilled by a Jack-up rig and
provision of power from a floating wind turbine.
Orcadian has entered into a
conditional sale and purchase agreement with Ping Petroleum UK plc
("Ping") which details the terms under which Ping will farm-in to
the Pilot development project. Upon conclusion of this deal
Orcadian would have an 18.75% stake in the Pilot development with
all pre-first oil development costs paid by Ping.
Emissions per barrel produced are
expected to be about a tenth of the 2021 North Sea average, and
less than half of the lowest emitting oil facility currently
operating on the UKCS. On a global basis this places the Pilot
field emissions at the low end of the lowest 5% of global oil
production.