Investment company Reabold Resources plc has offered to acquire additional shares in Corallian Energy Ltd, which could increase its interest from 36.87% to 49.99% in the Victory gas discovery, West of Shetland.
The offer will see the acquisition of up to 13.12% of Corallian shares from existing Corallian shareholders, in exchange for Reabold shares, at a ratio of 474 Reabold shares for 1 Corallian share.
If approved, Reabold would increase its net interest in the NPV of the project from its current £53 million to £72m.
VICTORY
Victory has a planned three-year gas production plateau at a rate of 70 mmscf/d (11,666 boepd) from Q4 2024 and deliver more than 25 BCF of gas per year.
The gas field is located near existing infrastructure and in particular the Total-operated Greater Laggan Area.
A letter of intent has been signed for an environmental survey on Victory, with work planned to start in July 2021.
Once completed, the environmental impact assessment will form part of the field development plan, a draft of which is expected to be submitted by the end of 2021.
Victory, in licence P2596 (Block 207/1a), has been evaluated to have 157 bcf of 2C contingent resource with an associated NPV of £146 million.
VALUE
Reabold said that Corallian considered the gas field to be a simple, low-risk gas development which had been fully appraised and required no additional pre-development drilling.
“We see Victory as not only adding significant value to Reabold, but also as one of the lowest risk development projects offered in the 32nd Round and one of the best remaining undeveloped assets in the UK Continental Shelf,” added co-chief executive Stephen Williams.
“The Victory development is likely to be relatively simple as it can utilise nearby existing infrastructure, in particular that of the Greater Laggan Area operated by Total, and as such offers a fast-tracked timeline to production.”
Corallian’s portfolio includes in the West of Shetland (Laxford discovery and Scourie prospect in licence P2605, and the Sandvoe prospect in licence P2493), the Viking Graben (Unst and Quoys prospects in licence P2464, and the Oulton discovery in licence P2504), the Inner Moray Firth (Dunrobin and Golspie prospects in licence P2478) and in the Central Graben (Curlew-A discovery in licence P2396).