Shell Completes UK Farm-in Deal
Anglo-Dutch Shell has completed its farm-in of 50% of the UK P2437 licence, operated by Cluff Natural Resources, following consent from the Oil & Gas Authority. The southern North Sea licence contains the Selene prospect and is 20 km from Shell' Barque field, which delivers gas to Bacton.
Cluff said August 13 that Shell has 30 days to pay the remaining $300,000, and that Shell will bear 75% of the costs of the exploration well, which it will drill and test at the “soonest possible opportunity,” up to a cap of $25mn. The Selene prospect contains an estimated prospective (P50) resource of 291bn ft³.
Cluff CEO Graham Swindell said the UK's southern gas basin is "coming under increased focus with several highly material exploration campaigns ongoing around our acreage. As such, we are delighted to have formally completed this farm out agreement with a committed partner such as Shell, to de-risk and ultimately drill the high-impact Selene prospect."
A number of other prospects have also been identified on the block which are covered by existing seismic data and will be evaluated in due course.
The licence has an effective date of October 1, with the first term of the licence running for a period of six years. Among the companies exploring in the same region is Independent Oil & Gas (IOG), which has spudded its Harvey well. IOG said August 12 that it had reached an agreement with security-holder London Oil & Gas that "simplified and clarified" its capital structure.