Egdon Resources to Sell Potential Shale Gas Resources
Egdon Resources plc has announced that it has entered into a conditional agreement with eCORP Oil & Gas UK Limited ("eCORP"), for the sale of Egdon Resources (New Ventures) Ltd ("ERNV"), the holder of Egdon's permit interests in France, to eCORP.
The key assets of ERNV are a 60% interest in the Navacelles Permit, a 40% interest in the Gex Permit and a 40% interest in the Gex Sud Permit application.
In addition to conventional oil and gas prospects the permits involved in the proposed deal all contain potential shale-gas resources, which are a key focus for eCORP.
eCORP Oil & Gas UK Limited, is a subsidiary of eCORP International, LLC, based in Houston, Texas and London, England. The eCORP companies develop, operate and own natural gas storage facilities, and develop and explore conventional and unconventional natural gas prospects in the US and Internationally. eCORP has been engaged in the research and development of unconventional hydrocarbon production since 1979. eCORP has been engaged in the development and operation of independently owned natural gas storage facilities and related assets since 1984.
Egdon commented France remains a key focus for the Company. ERNV's beneficial interests in the St. Laurent and Pontenx Permits and, when awarded the Donzacq Permit, are excluded from the transaction and being transferred to two newly-incorporated Egdon subsidiaries.
The Disposal will significantly strengthen Egdon's balance sheet and enable the business to focus on its key near-term projects in the UK and France.
Commenting on the transaction, Mark Abbott, Managing Director of Egdon said:
"The sale of ERNV to eCORP enables Egdon to convert these early-stage exploration projects into near-term cash whilst retaining access to upside value in a success case through a back-in option. eCORP's experience in similar plays in the US and its financial strength will enable an accelerated exploration programme leading to earlier potential commercialization."
The Gex Permit, where ERNV holds a 40% operated interest, is located in the Jura/Molasse Basin of Eastern France adjacent to the Swiss border and the City of Geneva. The main exploration targets comprise oil in shallow Oligocene sandstones, gas in deeper Triassic reservoirs and potential Jurassic, Cretaceous and Permo-Carboniferous shale-gas resources.
The Gex Sud Permit application, which is subject to competition, is located to the south and east of Gex and contains similar play types.
The Navacelles Permit, where ERNV holds a 60% operated interest with partners Eagle Energy Limited (20%) and a subsidiary of Heyco International (20%), is located in the SE Basin of France. The permit contains identified conventional gas prospects, which are candidates for fracture stimulation, and a potential shale-gas resource in Jurassic and Cretaceous source rocks.
Source: Egdon Resources plc