Egdon Resources plc Interim Results

Egdon Resources plc Interim Results

Egdon Resources plc (AIM:EDR), the UK-based exploration and production company with a primary focus on the onshore UK, announces its unaudited interim results for the six months ended 31 January 2018 (‘the period’). 

Overview and Highlights

Operational and Corporate

  • Conclusion of legal agreements and commencement of site construction at Springs Road where the operator IGas has advised it expects to commence drilling around mid-2018
  • Following rejection by the Planning Inspectorate of Egdon’s appeals against the two planning refusals in respect of the development of the Wressle oil discovery, Egdon announced its intention to submit a new planning application to address in detail all matters highlighted by the Inspector in his Decision Notice and to also make an application to extend the existing planning for the wellsite
  • Acquisition of 100% interest in Promote Licence P2304 from Arenite Petroleum Limited and Europa Oil & Gas Limited resulting in an expanded core area to the south of the Resolution offshore gas discovery
  • Completion of the acquisition of the producing Fiskerton Airfield oil field in Lincolnshire licence EXL294 and subsequent sale of 20% interest to Union Jack Oil plc to balance financial exposure
  • Production of 17,962 barrels of oil equivalent (“boe”) (98 barrels of oil equivalent per day “boepd”) (H1 2017: 16,882 boe; 94 boepd)
  • Financial Performance
  • Oil and gas revenues during the period £0.51 million (H1 2017: £0.51 million)
  • Loss for the period of £0.85 million (H1 2017: loss of £0.73 million)
  • Cash at bank of £4.10 million (H1 2017: £6.80 million)
  • Net current assets as at 31 January 2018 of £5.08 million (H1 2017: £8.00 million)
  • The Company has no debt (H1 2017: Nil)

Post-Period Events

  • Farm-out of interests in PEDL253 (Biscathorpe) to Union Jack Oil plc and Humber Oil & Gas Limited
  • Workovers completed of two wells at Fiskerton Airfield with production increased to approaching 30 barrels of oil per day (“bopd”), ahead of further optimisation, an increase of 14 bopd from pre workover levels
  • Planning application submitted on 13 April 2018 to extend existing planning consent at the Wressle wellsite for a period of 12 months from the decision date
  • Additional site investigation boreholes and two deeper cored boreholes completed to support a new planning application for Wressle field development due for submission within the next month
  • Submission of planning applications to extend existing consents for a further 3 years at both North Kelsey and Biscathorpe
  • Encouraging Results from third party activity includes the drilling of UK’s first horizontal shale gas well at Preston New Road in Lancashire by Cuadrilla 

Commenting on the results, Philip Stephens, Chairman of Egdon said  After a busy and productive six months, we are confident that we will make further progress in the second half of the year, especially on two important fronts. Firstly, after many setbacks, we hope to be successful in gaining planning permission in order to allow us to develop our conventional oil discovery at Wressle. Secondly, we await the drilling of the first well at Springs Road where we have a carried interest in this significant unconventional prospect in the Gainsborough Trough. Success in these prospects will significantly enhance our future.

Whilst challenges no doubt remain, the UK shale business is gaining considerable traction with the completion recently of the first horizontal shale gas well in Lancashire. With an increased level of industry activity due to take place over the coming months, we believe the spotlight will shine more brightly on this exciting space, and Egdon’s sizeable acreage position ensures we represent a compelling vehicle for investors to benefit from the eventual uptick in much needed onshore activity.”

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