25th Aug 2020 09:59
(Alliance News) - Egdon Resources PLC on Tuesday said UK regulators approved a farm-out deal with a Royal Dutch Shell PLC subsidiary at two offshore licences.
Egdon shares were 18% higher at 2.48 pence each in London on Tuesday morning.
The Oil & Gas Authority gave its backing to Shell UK Ltd taking a 70% stake at the P1929 and P2304 licences, which contain the Resolution and Endeavour gas discoveries. Egdon will keep a 30% stake.
It's at the Resolution and Endeavour discoveries where Shell UK must pay 85% of the costs for the acquisition and processing of a 3D seismic survey. Under the terms of the deal, this must be completed by the end of May 2021.
"The carry on the acquisition costs will be capped at USD5 million gross, beyond which Egdon would pay 30% of the survey costs. Furthermore, Shell will also pay 100% of all studies and manpower costs through to the well investment decision on the licences," Egdon added.
By Eric Cunha; [email protected]
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