Independent Oil and Gas plc (“IOG” or the “Company”), the development and production company focused on becoming a substantial UK gas producer, is pleased to provide an update on the Harvey appraisal well and other key corporate activities.
Harvey Appraisal Well Update
The Company’s preparations to drill the Harvey appraisal well with the Maersk Resilient jack-up rig are now well advanced. The Maersk Resilient is a modern, high-spec rig with a strong operating history and an excellent safety record. It is currently on contract with another operator, drilling a well in the Central UK North Sea which is expected to conclude in late July. Allowing for mobilisation to the Southern North Sea, IOG therefore currently expects the Maersk Resilient to be on location at Harvey by the end of July. In the success case, the well is forecast to take up to two months.
In the meantime, IOG and its designated Well Operator, Fraser Well Management, are completing final procurement, regulatory and other preparatory processes ahead of the well, all of which are proceeding on schedule.
Harvey is centrally located within IOG’s asset portfolio in UK Southern North Sea Blocks 48/23c, 48/24a, and 48/24b, close to the IOG owned and proven 550 MMcfd capacity Thames Pipeline. The primary objective of the Harvey appraisal well is to confirm gas volumes which management estimate at 85/129/199 BCF Prospective Resources in the Low/Best/High case, with a 63% Geological Chance of Success¹ and secondly to demonstrate reservoir deliverability. If successfully appraised, the additional scale and synergies of a Harvey development could substantially enhance the portfolio’s overall value and returns. A detailed presentation about the Harvey opportunity can be found on the IOG website.
Farm-Out Process Update
IOG has continued to work intensively on the farm-out process for its Core Project, which comprises 410 BCF²,³ of 2P+2C reserves and resources across six discovered Southern North Sea (SNS) gas fields. This process has progressed substantially and the Company aims to be in a position to release further updates during July. The farm-out is intended to provide a significant amount of development funding and represent a major milestone towards Final Investment Decision (FID) on Phase 1 of the Core Project, which is planned at the earliest feasible time.
Thames Reception Facilities Acquisition Update
In addition, IOG remains in advanced exclusive discussions to acquire the Thames Reception Facilities at the Bacton Gas Terminal from its joint owners, the Thames Partners. As previously indicated, the process of agreeing the required documentation has highlighted certain legal complexities relating to land title which have required co-ordinated input from several parties. IOG has been working constructively with the Thames partners in a dedicated process and expects to resolve these outstanding issues and sign the agreement at the earliest feasible time.
Andrew Hockey, CEO of IOG, commented:
“We are pleased to confirm that we are on schedule to drill our exciting appraisal well at Harvey. The well is a major catalyst for IOG, potentially proving up a substantial, high-quality reservoir in the heart of our core area, close to our fully-owned Thames Pipeline. Final preparations are underway and the summer drilling slot should help to minimise weather-related operational risks in executing the well.
Needless to say, our primary focus remains to progress the funding of our Core Project to FID and in particular the farm-out process. We are highly motivated to deliver a farm-out transaction that can enable us to progress to FID this summer.
We look forward to updating our shareholders on progress on these key milestones for the Company.”