17th Jan 2014 10:48
LONDON (Alliance News) - Shares in Enegi Oil PLC were trading higher Friday morning after the oil and gas company said that it has extended the initial five year licence period of its offshore exploration license EL1116, in western Newfoundland for a period of 12 months.
Back in December the group announced that its partner Black Spruce Exploration had decided to reduce its holding in the company, and it had taken out a GBP1 million loan to allow it to buyback 12.3 million shares from Black Spruce. As part of the deal, Black Spruce had agreed to pay the USD250,000 drilling deposit to the Canada-Newfoundland Offshore Petroleum Board for the extension of EL1116 in advance of the drilling programme in 2014.
In its latest trading update Friday, Enegi Oil said that this has extended the initial five year licence period, known as Period 1, for EL1116 by a further 12 months.
It said that this is in advance of the drilling programme which is planned to take place on the licence this year, targeting the St George's Bay prospect.
The group said that on completion of the well, under the terms of the licence, EL1116 will enter Period II, and will then be valid for a further three years following the end of this extended 12 month period.
"The well on EL1116 will be drilled, by BSE, following the anticipated successful drilling at the Garden Hill Field which is expected to commence in April. The St George's Bay prospect is expected to be drilled from onshore to offshore to delineate the offshore extent of the Garden Hill hydrothermal dolomite trend," the company said in a statement.
Enegi Oil shares were trading 6% higher Friday morning at 7.55 pence per share.
By Rowena Harris-Doughty; [email protected]; @rharrisdoughty
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