Deltic Energy Plc is pleased to confirm that it and Shell U.K. Limited ("Shell"), its Joint Venture Partner on Licence P2252, have made a positive well investment decision to drill the high impact Pensacola Prospect on Licence P2252 in the UK Southern North Sea. Shell and Deltic have subsequently confirmed to The Oil and Gas Authority that the contingent well commitment is now firm.
The drilling of this key well on Pensacola has the potential to be transformational for Deltic and is a vital step in evaluating the highly prospective Zechstein reef play which in turn has the potential to revitalise exploration in the Southern North Sea.
Following re-interpretation of the new 3D seismic data acquired over the prospect, Deltic estimates that the Pensacola Prospect contains gross P50 Prospective Resources of 309 BCF (with a P90-P10 range of 39 BCF to 1,181 BCF) which will rank Pensacola as one of the highest impact exploration targets to be drilled in the gas basin in recent years. Significantly, the Shell/Deltic JV's ("the JV") new interpretation of the 3D seismic data has also resulted in a much-improved view of the geological chance of success associated with the prospect which has increased materially from 20% to 55%.
The Operator expects the well to be drilled in May 2022 and this timing allows the JV to take advantage of a drilling unit that will be contracted by Shell as part of a multi well drilling campaign which in turn brings advantageous day rates and operational efficiencies for the JV. Deltic remains fully funded for its 30% working interest in the well.
The Deltic team looks forward to continuing to work with Shell as the JV continues to mature the well design and undertake key preparatory works including well site survey and regulatory permitting.
Graham Swindells, Chief Executive of Deltic Energy, commented:
"Confirmation of this well investment decision represents the achievement of another key milestone as we continue to execute our exploration-led strategy in the Southern North Sea with our world class partner, Shell. The rigorous re-evaluation of the Pensacola Prospect has validated and reinforced the fantastic work of our technical team and their initial view that the Pensacola prospect, and the Zechstein play as a whole, represented a significant missed opportunity in the Southern North Sea. Well planning is already underway, and we look forward to providing regular updates as we progress through the planning phase towards the commencement of operations, in addition to continuing to mature our other prospects, including Selene, towards drilling."