15th Apr 2025 14:22
(Alliance News) - Deltic Energy PLC on Tuesday said contingent resources at the Selene gas discovery in the UK Southern North Sea have increased by a third following updated reservoir analysis, significantly boosting the project’s economic value.
Shares in Deltic Energy were up 16% to 4.62 pence in London on Tuesday morning.
The London-based investor with an exploration and appraisal portfolio in the southern and central North Sea said it now estimates gross 2C contingent resources at 174 billion cubic feet, up 33% from earlier projections.
The revision follows a detailed analysis of core samples from the 48/8b-3Z well, operated by Shell UK Ltd, in which Deltic holds a 25% non-operated stake.
Deltic said porosity and permeability characteristics in the reservoir's B-sand interval were "significantly better" than previously assumed, leading to improved recovery factors and higher initial production estimates. The updated modelling indicates initial production rates of 70 million standard cubic feet per day from a two-well development, with a plateau lasting 18 months.
As a result, the post-tax net present value at a 10% discount rate increased to USD83 million at a gas price of 80 pence per therm, and USD114 million at 100p per therm - a 45% increase compared to previous estimates.
"We've significantly refined and improved our understanding of Selene," said Chief Executive Andrew Nunn. "The 45% increase in project NPV net to Deltic is particularly pleasing, especially in the context of our current market capitalisation."
Deltic also confirmed that the gas quality was "very dry", requiring minimal processing for National Grid specifications. It expects first gas production in 2029, with a final investment decision targeted for early 2027.
By Eva Castanedo, Alliance News reporter
Comments and questions to [email protected]
Copyright 2025 Alliance News Ltd. All Rights Reserved.
Related Shares:
ShellDeltic Energy