Deltic Energy advances North Sea exploration with new license acquisition

Deltic Energy Plc, an AIM-quoted natural resources investing company, has announced the acceptance of a pivotal license awarded by the North Sea Transition Authority (NSTA) in the UK’s 33rd Offshore Licensing Round. The license, identified as P2672, strategically positions Deltic with 100% working interest (WI) adjacent to the productive West Sole gas field, encompassing blocks 47/5e, 47/10c, and 48/6c.

The license area includes the Pharos and Teviot gas discoveries. A detailed evaluation conducted by Deltic as part of their application has led to a revised understanding of the geological structure in the area, now identifying the Pharos discovery and the Blackadder prospect as a single Leman Sandstone structure. This reevaluation has significant implications for the resource potential of the area.

Preliminary volumetric assessments suggest promising resources:

– The Blackadder/Pharos structure, drilled in well 47/05d-6, indicates prospective resources ranging from 66 BCF (P90) to 293 BCF (P10), with a geological chance of success (GCoS) estimated at 65%.

– The Teviot gas structure, accessed via well 47/10-8, shows smaller but notable resources from 9 BCF (P90) to 27 BCF (P10) with the same GCoS.

Both structures encountered gas-bearing Leman Sandstone; however, the lack of flow tests on these wells introduces a residual risk concerning reservoir effectiveness. The initial Phase A work program for the license focuses on reprocessing legacy 3D seismic data to enhance reservoir imaging and refine the structural model, aiming to further de-risk the Blackadder structure at minimal cost.

Graham Swindells, CEO of Deltic, highlighted the strategic significance of the Blackadder project: “Blackadder’s proximity to existing infrastructure, which requires new third-party gas to defer decommissioning, enhances its value in a mature basin where new licenses are likely to become increasingly scarce.”

Deltic plans to advance the analysis of legacy data in preparation for a farm-out, anticipating the drilling of an appraisal well on Blackadder in the near future. This approach mirrors successful strategies employed at other prospects, such as Selene, where reevaluation of old datasets has uncovered significant missed pay opportunities.

Deltic Energy’s acquisition of the P2672 license marks a crucial step in its strategy to capitalize on underexplored opportunities in the North Sea. By leveraging advanced seismic reprocessing and strategic site evaluations, Deltic aims to enhance its portfolio and contribute to the UK’s energy security, aligning with broader efforts to maximize recovery from the North Sea’s mature fields. As Deltic moves forward with its exploration and development plans, the company is well-positioned to play a significant role in the evolving landscape of the UK oil and gas sector.