13th Jun 2016 10:17
LONDON (Alliance News) - UK Oil & Gas Investments PLC said Monday it has inked agreements with Celtique Energie Petrolem Ltd and Magellan Petroleum Uk Ltd to acquire 100% ownership of the 300 square kilometre Weald Basin licence PEDL234 for GBP3.5 million.
It has entered into a share purchase agreement with Celtique to buy Celtique Energie Wealde Ltd, which owns a direct 50% stake in the licence, and an asset transfer agreement with Magellan, which owns the other 50% stake in the licence.
Additionally, via a second asset transfer agreement, UK Oil & Gas will be assigned Magellan's 22.5% stake in offshore Isle of Wight licence P1916, taking its interest in that licence to 100%.
It will pay both Celtique and Magellan GBP625,000 in cash and GBP1.13 million in the form of 71.3 million shares as consideration.
UK Oil & Gas said the acquisition more than doubles its net acreage in the Kimmeridge Limestone Oil province, and importantly, the licence includes regulatory permission to drill the Kimmeridge province at the Broadford Bridge-1 site.
The licence is situated to the south west of the company's main Kimmeridge oil interests at Horse Hill and Holmwood.
"This is a transformational step for the company and its position in the new Weald Kimmeridge Limestone oil resource play. The transaction more than doubles our net acreage position and potential recoverable resource base in the most prospective part of the play, all at a very reasonable entry price. The transaction makes UKOG the leading player and acreage holder in Kimmeridge oil and a significant player in the UK onshore oil industry," said Executive Chairman Stephen Sanderson in a statement.
Shares in UK Oil & Gas were down 1.3% at 1.55 pence Monday morning.
By Hana Stewart-Smith; [email protected]; @HanaSSAllNews
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