Egdon to acquire additional 20% interest in licence PEDL068

UK-based Egdon Resources has signed an agreement to acquire an additional 20% interest from DESS Energy in petroleum exploration and production licence PEDL068, located in the Cleveland Basin of North Yorkshire.

The transaction follows DESS’ purchase of Sterling Resources UK’s 47% interest in PEDL068, which is operated by Egdon.

For the upcoming six months, Egdon will bear DESS’s retained 20% share of ongoing expenditure and also accept liability for the latter’s 20% share of the existing abandonment liability for the Kirkleatham site and Kirkleatham-1 well.

The transaction is expected to add about 1.75 billion cubic feet of best estimate contingent and prospective conventional resources to Egdon’s portfolio.

DESS has also divested a 5% interest to existing PEDL068 partner Montrose Industries under a separate deal.

Upon completion of the transactions, Egdon Resources UK will own a 60% interest in PEDL068. DESS will hold 22%, Yorkshire Exploration 8%, and Montrose Industries will hold a 10% stake.

PEDL068 contains the Kirkleatham gas field and also the Westerdale / Ralph Cross gas discovery where planning consent has been secured for an appraisal well.

Egdon Resources managing director Mark Abbott said: “This acquisition builds on our existing interest in PEDL068, adding additional resource potential to the company at low cost and complements our pending award of surrounding licence PEDL259 in the 14th onshore licensing round, in what was a highly sought after region.”