INEOS Buys 80% Interest in PEDL 162 from Reach Coal Seam
INEOS Upstream signed an agreement to acquire from Reach Coal Seam Gas an 80% interest in PEDL 162 in the Midland Valley of Scotland, confirming its rising appetite for shale gas assets in the United Kingdom.
‘This licence area of 400 km2 is next to PEDL 133, in which INEOS already owns a 51% stake of the shale layer. As part of the deal, INEOS will be the operator of the licence, and will fund the initial appraisal activity (consisting of 2 vertical science wells and 100 km2 of 3D seismic),’ reads the note released on Monday.
The British Geological Survey, in association with the UK Department of Energy and Climate Change, found that the central estimate for the resource is 80.3 trillion cubic feet, compared to 1,329 tcf in the Bowland formation. In the report publish in July, the British press labelled Scottish shale gas reserves as ‘modest’ and ‘pale’, but INEOS’ interest seems to hint at the opposite.
“I am delighted to have concluded this deal in Scotland, which is a very good fit with our existing licence interest in the adjoining PEDL 133. We are keen to move quickly to evaluate the potential of this resource, and determine if we can economically produce gas from this area,” INEOS Upstream CEO, Gary Haywood commented.
Reach Coal Seem Gas finally found a way to monetise its assets.
“We are very pleased to form this joint venture to appraise PEDL162 with INEOS,” Reach CSG Technical Director Miles Newman commented in a separate statement.
The programme is meant to assess the hydrocarbon potential of the West Lothian Oil-shale Formation across 400 sq km of the Central Belt of Scotland.
IN THE REST OF THE UK...
Some other market movements took place in the UK on Monday.
Petrofac has secured a Duty Holder contract for two assets in the Southern North Sea, following their acquisition by Faroe Petroleum.
“Over the past seven years we’ve built up a strong track record with Schooner and Ketch supporting the introduction of seven new wells into the development and supporting the previous operator to significantly and safely increase production. We’re delighted to continue working with the new owner Faroe Petroleum on these assets and look forward to helping them unlock more value and safely extend the life of these fields,” Walter Thain, Senior Vice President Europe, Petrofac Offshore Projects & Operations stated in a communiqué.
Faroe Petroleum bought the assets from Tullow Oil last week.