Deltic nears first exploration drill

Deltic Energy plc is marking 2021 as a year of achievement and progress ahead of drilling the first exploration well in its Southern and Central North Sea portfolio.

AGREEMENTS

For its audited results for the year ended 31 December 2021, the company confirmed its first exploration well on the Pensacola prospect (licence P2252).

The rig selection and contract process is well advanced with Deltic-Shell joint venture scheduling drilling the Pensacola well in late Q3 2022.

The company also marked a “transformational” farm-out deal with Capricorn Energy plc to form an exploration partnership over five licences in the Southern North Sea gas basin.

Deltic also received a US$1m contribution towards historic costs. 

FINANCES

The company recorded net cash outflow from operations and investing activity for the year of £1.8m (2020: £1.8m).

The company held a cash position of £10.1m (2020: £12m) with no debt.

As at 31 March 2022, Deltic had cash on hand (unaudited) of £8.6 million, with £0.9m of the post-year end spending related to progressing Pensacola well planning.

OUTLOOK

Chief executive Graham Swindells said it was imperative that the UK continued to encourage further exploration and that he looked forward to the launch of the UK’s 33^rd Licensing Round in the Autumn.

“The UK oil and gas industry has a vital role to play in the energy transition.

“Deltic is fully supportive of ‘net zero’ ambitions and, with a largely gas dominated portfolio, we believe we have the potential and ability to contribute to this transition.

“In addition to the development of the North Sea gas licences the Company has acquired to date, the company proposes to continue to evaluate other potential oil and gas projects in line with its investing policy.”

INVESTMENTS

Both Mr Swindells and chairman Mark Lappin said that the board would initially focus on projects in the oil & gas and mining sectors.

“Particular consideration will be given to identifying investments which are, in the opinion of the directors, underperforming, undeveloped and/or undervalued.”