TIDMFPM
RNS Number : 9451O
Faroe Petroleum PLC
23 May 2018
23 May 2018
Faroe Petroleum plc
("Faroe", the "Company")
Brasse East Well Commitment
Faroe Petroleum, the independent oil and gas company focusing
principally on exploration, appraisal and production opportunities
in Norway and the UK, is pleased to announce the commitment by the
PL740 Brasse Joint Venture partners (Faroe 50% and operator and
Point Resources 50%) to drill the Brasse East exploration well and
award the associated rig contract, with commencement of drilling
operations expected in Q4 2018.
Recent seismic reprocessing and reinterpretation work has
identified significant hydrocarbon potential in the vicinity of the
eastern flank of the Brasse field, which was discovered in 2016.
Success could add further incremental volumes to the existing 2P
reserves of 30.7 mmboe (net to Faroe) for the Brasse field
development. This new Brasse East exploration well demonstrates the
progressive approach being adopted by the Brasse Joint Venture
towards derisking the wider prospective areas both to the east and
the north east of the Brasse field, which includes the Brasse
Extension prospect. It is envisaged that any additional volumes
proven by the Brasse East exploration well may be developed in
conjunction with the planned Brasse field development.
Faroe, as licence operator, has entered into a contract for the
use of the Transocean Arctic semi-submersible rig for drilling of
the Brasse East well, back-to-back and immediately following
drilling of the Rungne exploration well in PL 825 (Faroe 40% and
operator), for which the Transocean Arctic is already on contract.
Both wells are expected to be drilled in H2 2018.
The Brasse discovery is located immediately to the south of the
Brage field and to the south east of the Oseberg field. At the end
of 2017, the Brasse field development feasibility study phase was
completed, confirming several economically attractive development
solutions and export routes. Concept studies are currently
progressing according to plan. The co-venturer in the Brasse PL
740/PL 740 B/PL 740 C licences is Point Resources AS (50%).
Graham Stewart, CEO, commented:
"I am pleased to announce the addition into our 2018 exploration
drilling programme of the Brasse East exploration well, which
brings the total number of exploration and appraisal wells planned
for the year to six. The Brasse development programme continues
apace as we work towards concept selection by year end. If
successful the Brasse East well could contribute significant
additional hydrocarbons, thereby potentially adding further value
to this attractive flagship development project.
"Meantime we await results of the ongoing side-track and
potential flow testing operations at the Fogelberg field. We are
also preparing for drilling of the exciting, high impact
Faroe-operated Rungne exploration well, our next exploration well,
scheduled to spud in late summer."
- Ends -
For further information please contact:
Faroe Petroleum plc Tel: +44 (0) 1224 650
Graham Stewart, CEO 920
Stifel Nicolaus Europe Tel: +44 (0) 20 7710
Limited 7600
Callum Stewart / Nicholas
Rhodes / Ashton Clanfield
BMO Capital Markets Tel: +44 (0) 207 236
Neil Haycock / Tom 1010
Rider / Jeremy Low
FTI Consulting Tel: +44 (0) 20 3727
Edward Westropp / Emerson 1000
Clarke
Andrew Roberts, Group Exploration Manager of Faroe Petroleum and
a Geophysicist (BSc. Joint Honours in Physics and Chemistry from
Manchester University), who has been involved in the energy
industry for more than 30 years, has read and approved the
exploration and appraisal disclosure in this regulatory
announcement.
The information contained within this announcement is considered
to be inside information prior to its release, as defined in
Article 7 of the Market Abuse Regulation No. 596/2014, and is
disclosed in accordance with the Company's obligations under
Article 17 of those Regulations.
Notes to Editors
The Company has, through successive licence applications and
acquisitions, built a substantial and diversified portfolio of
exploration, appraisal, development and production assets in
Norway, the UK and Ireland.
Faroe Petroleum is an experienced licence operator having
operated several exploration wells successfully in Norway and the
UK and is also the production operator of the Schooner and Ketch
gas fields in the UK Southern Gas Basin and the Trym and Oselvar
fields in the Norwegian North Sea. Faroe has extensive experience
working closely with major and independent oil companies both in
Norway and in the UK.
The Company's substantial licence portfolio provides a diverse
spread of risk and reward. Faroe has an active E&A drilling
programme and has interests in a portfolio of producing oil and gas
fields in the UK and Norway, including the Schooner and Ketch gas
fields and the Blane oil field in the UK, and interests in the
Brage, Ringhorne East, Ula, Tambar, Oselvar and Trym fields in
Norway. In 2016 the Company completed the acquisition of a package
of Norwegian producing assets from DONG Energy including interests
in the Ula, Tambar, Oselvar and Trym fields. Full year average
production for 2018, is estimated to be between 12-15,000
boepd.
In November 2013 and March 2014 Faroe announced the Snilehorn
(Bauge) and Pil (Fenja) discoveries in the Norwegian Sea in close
proximity to the Njord and Hyme fields. In July 2016, the Company
announced the Brasse discovery, close to the Brage field, and the
Njord North Flank discovery, close to the Njord field, both in
Norway. In February 2018, the Company announced the sale of part of
its interest in the Fenja field and in April 2018 announced the
significant Iris and Hades discoveries.
Norway operates a tax efficient system, which incentivises
exploration, through reimbursement of 78% of costs in the
subsequent year. Faroe has built an extensive portfolio of high
potential exploration licences in Norway, which, together with its
established UK North Sea positions provides the majority of
prospects targeted by the Company's sustainable exploration
drilling programme. Faroe has had significant success in
exploration on the Norwegian continental shelf, and the great
majority of the Company's 2P reserves have been generated directly
from Faroe's exploration success.
Faroe Petroleum is quoted on the AIM Market of London Stock
Exchange. The Company is funded from cash reserves and cash flow,
and has access to a $250 million reserve base lending facility,
with a further US$100million available on an uncommitted
"accordion" basis. The Company has also raised a $100m senior
unsecured bond. Faroe has a highly experienced technical team who
are leaders in the areas of seismic and geological interpretation,
reservoir engineering and field development, focused on creating
exceptional value for its shareholders.
This information is provided by RNS, the news service of the
London Stock Exchange. RNS is approved by the Financial Conduct
Authority to act as a Primary Information Provider in the United
Kingdom. Terms and conditions relating to the use and distribution
of this information may apply. For further information, please
contact rns@lseg.com or visit www.rns.com.
END
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