Angus Energy plc (AIM: ANGS) is pleased to announce that, further to its announcement of 19 June 2019, the Oil and Gas Authority has given its consent to the assignment of a 51% share in Saltfleetby Energy Limited's interest in the Saltfleetby Field (the "Field") blocks of PEDL005 to Angus Energy Weald Basin No 3 ("AWB"), a wholly owned subsidiary of the Company. That Authority has also given consent to the appointment of AWB as Exploration and Production Operator of the Field.
This is a great day for Angus and it enables the Company to disclose much of the hard work it has engaged in to reconnect this Field. Some of the achievements to date are:
· National Grid plc ("NTS") have already begun detailed design work for the reconnection facilities at the Theddlethorpe Entry Point and aiming to keep to our timetable.
· Angus has already identified most of the long lead items needed to compress and treat the gas to NTS pressure and specification and will make determination on pricing options in the coming weeks.
· Angus have mapped the pathway of the additional stretch of pipeline needed to extend the existing connection to Theddlethorpe on to the Entry Point. All of this additional pipeline will run underneath NTS owned land.
· We have engaged planning consultants to prepare Applications for Planning approval from North Lincolnshire County Council ("NLCC") for putting additional equipment on site and laying pipeline extensions.
· We have engaged the services of Oilfield International to produce a Competent Persons Report ("CPR") on the Field. This we hope to have available during the early part of Q1 2020.
· We have prepared an Abandonment Plan for two of the eight wells which, subject to regulatory approvals, we hope to execute within a month to six weeks. This reduces the overall liability on the Field.
· We have opened discussions with an oil major for a multi-year annual off-take arrangement. The Field's first full year's gross production we continue to expect to be between 17 million and 19 million therms based on last known and reported production rates of c. 50,750 therms per day in 2017 as adjusted for a steady twenty year decline curve.
There are still quite a few hoops to get through, most particularly OGA approval of our Field Development Plan (which will also remove the Abandonment Notice on the Field put in place as a holding measure following the change in ownership), EA, HSE and NLCC approval of changes to the site, assent of partners on this split Licence to the Licence transfer itself, and the everyday technical challenges themselves but, for the moment, the Company is forging ahead.
George Lucan, Managing Director, writes:
"This comes as fantastic news for the Company and opens up a pathway towards real production and cashflow without the exploration risk attendant on many other projects. This is gas right next door to one of the dozen or so entry points on the NTS system. This is gas producing on a steady and predictable decline curve for 20 years. This is gas to be pulled immediately from two wells which show the same or greater well head pressure than when they were shut in in 2017. Now we have to complete reconnection and start squeezing this gas into people's homes and dividends into shareholders pockets."