Europa Oil & Gas (Holdings) Plc Completion of Sale of Interest in Wressle Discovery
22 Novembre 2016 - 8:00AM
UK Regulatory
TIDMEOG
Europa Oil & Gas (Holdings) plc / Index: AIM / Epic: EOG / Sector: Oil & Gas
22 November 2016
Europa Oil & Gas (Holdings) plc ('Europa' or 'the Company')
Completion of Sale of Interest in Wressle Discovery
Europa Oil & Gas (Holdings) plc, the AIM traded oil and gas exploration,
development and production company focused on Europe, is pleased to announce
that its proposed sale of a 3.34% working interest in PEDLs 180 and 182 ('the
Licences') in North Lincolnshire to Union Jack Oil plc ('UJO') for a cash
consideration of GBP600,000 ('the Transaction') has been approved by the Oil and
Gas Authority ('OGA'). The Licences cover the Wressle discovery ('PEDL180')
and the Broughton North prospect ('PEDL182').
Following OGA approval of the Transaction, Europa retains a 30.00% interest in
the Licences alongside Egdon Resources UK Limited (25.00%), Celtique Energie
Petroleum Limited (33.33%) and UJO (11.67%). Based on the terms of the
Transaction, Europa's 30.00% interest in the Licences has an implied mark to
market valuation of GBP5.4 million.
The GBP600,000 cash consideration, which has been received by the Company, will
help fund Europa's share of the costs associated with bringing the Wressle
discovery into production in early 2017, expected to be at a gross rate of 500
bopd. At this level, Europa's anticipated net share of 150 bopd will more than
double the Company's existing production.
A table summarising gross volumes at Wressle and Broughton North provided by
ERC Equipoise Limited ('ERCE') in a Competent Persons Report, along with net
volumes attributable to Europa's post Transaction interests, can be found at
the end of this announcement.
Europa CEO Hugh Mackay said, "With a mark to market valuation of GBP5.4 million
implied by this Transaction, the value of our remaining 30% interest in PEDLs
180 and 182 accounts for half our current market capitalisation.
"We also hold within our portfolio: seven exploration licences offshore
Ireland, which have the potential to host gross mean un-risked prospective and
indicative resources of more than 4 billion barrels oil equivalent and 1.5 tcf
gas; three producing fields onshore UK, which in the last year produced 123
boepd net to Europa; and a number of exploration projects onshore UK including
Holmwood in PEDL143 in the Weald Basin, which we rate as one of the best
undrilled conventional prospects onshore UK. We continue to actively manage
our portfolio and will not hesitate to act when opportunities to add
shareholder value arise."
Table summarising gross volumes at Wressle and Broughton North along with net
volumes attributed to Europa's interests before and after transaction
Gross Net Volumes
Volumes attributable
to Europa
Oil MMstb Gas Oil and Oil MMstb Gas
Bscf Gas* Bscf Oil and
MMboe Gas*
MMboe
Wressle 0.20
2P Ashover Grit and 0.62 0.65 0.19 0.06 0.20
Wingfield Flags
2C Penistone Flags 2.00
1.53 1.86 0.46 0.60 0.56
0.51
Broughton North 0.51 0.60 0.15 0.15 0.18
Mean Unrisked
Prospective Resources
*Gas converted to oil equivalent using 6 Bscf/MMboe conversion and added to oil
volume
Glossary:
Some of the terms used in this announcement are defined below. A more
exhaustive glossary is contained in ERCE's letter to Europa's Board of
Directors summarising the findings of their CPR has been published on the
Company's website (www.europaoil.com).
Proved Reserves
Proved Reserves are those quantities of petroleum, which by analysis
of geoscience and engineering data, can be estimated with reasonable
certainty to be commercially recoverable, from a given date forward,
from known reservoirs and under defined economic conditions, operating
methods, and government regulations.
If deterministic methods are used, the term reasonable certainty is intended to
express a high degree of confidence that the quantities will be recovered. If
probabilistic methods are used, there should be at least a 90% probability that
the quantities actually recovered will equal or exceed the estimate. The area
of the reservoir considered as Proved includes:
* the area delineated by drilling and defined by fluid contacts,
if any, and
* adjacent undrilled portions of the reservoir that can reasonably
be judged as continuous with it and commercially productive on
the basis of available geoscience and engineering data
In the absence of data on fluid contacts, Proved quantities in a reservoir are
limited by the lowest known hydrocarbon (LKH) as seen in a well
penetration unless otherwise indicated by definitive geoscience,
engineering, or performance data. Such definitive information may
include pressure gradient analysis and seismic indicators. Seismic data
alone may not be sufficient to define fluid contacts for Proved
Reserves (see "2001 Supplemental Guidelines," Chapter 8). Reserves in
undeveloped locations may be classified as Proved provided that the
locations are in undrilled areas of the reservoir that can be judged with
reasonable certainty to be commercially productive and interpretations of
available geoscience and engineering data indicate with reasonable
certainty that the objective formation is laterally continuous with
drilled Proved locations. For Proved Reserves, the recovery efficiency
applied to these reservoirs should be defined based on a range of
possibilities supported by analogues and sound engineering judgment
considering the characteristics of the Proved area and the applied development
programme.
2P
Proved + Probable, a best estimate category of Reserves.
Contingent Resources
Contingent Resources are those quantities of petroleum estimated, as
of a given date, to be potentially recoverable from known
accumulations by application of development projects, but which are
not currently considered to be commercially recoverable due to one or more
contingencies.
Contingent Resources may include, for example, projects for which
there are currently no viable markets, or where commercial recovery
is dependent on technology under development, or where evaluation of
the accumulation is insufficient to clearly assess commerciality.
Contingent Resources are further categorized in accordance with the
level of certainty associated with the estimates and may be sub?
classified based on project maturity and/or characterized by their economic
status.
2C
A best estimate category of Contingent Resources.
Prospective Resources
Prospective Resources are those quantities of petroleum which are
estimated, as of a given date, to be potentially recoverable from
undiscovered accumulations. Potential accumulations are evaluated according to
their chance of discovery and, assuming a discovery, the estimated
quantities that would be recoverable under defined development
projects. It is recognized that the development programs will be of
significantly less detail and depend more heavily on analog developments
in the earlier phases of exploration.
* * ENDS * *
For further information please visit http://www.europaoil.com/ or contact:
Hugh Mackay Europa + 44 (0) 20 7224
3770
Phil Greenhalgh Europa + 44 (0) 20 7224
3770
Matt Goode finnCap Ltd + 44 (0) 20 7220
0500
Simon Hicks finnCap Ltd + 44 (0) 20 7220
0500
Frank Buhagiar St Brides Partners Ltd + 44 (0) 20 7236
1177
Susie Geliher St Brides Partners Ltd + 44 (0) 20 7236
1177
Notes
Europa Oil & Gas (Holdings) plc has a diversified portfolio of multi-stage
hydrocarbon assets that includes production, exploration and development
interests, in countries that are politically stable, have transparent licensing
processes, and offer attractive terms. In 2016 Europa produced 123 boepd. Its
highly prospective exploration projects include the Wressle development
(targeting production start-up in early 2017 at up to 500 bopd gross) in the UK
and seven licences offshore Ireland with the potential to host gross mean
un-risked prospective and indicative resources of more than 4 billion barrels
oil equivalent and 1.5 tcf gas across all seven licences.
Qualified Person Review
This release has been reviewed by Hugh Mackay, Chief Executive of Europa, who
is a petroleum geologist with 30 years' experience in petroleum exploration and
a member of the Petroleum Exploration Society of Great Britain, American
Association of Petroleum Geologists and Fellow of the Geological Society. Mr
Mackay has consented to the inclusion of the technical information in this
release in the form and context in which it appears.
END
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