07 Feb 2014
Update on ATP Oil and Gas UK Ltd Sale Process and Blythe and Skipper Licences
Further to the announcement issued by the Company on 24th December 2013, Independent Oil and Gas Plc ("IOG") (AIM:IOG.L), is pleased to have agreed the following Press Release which has been issued today by ATP Oil and Gas (UK) Limited ("ATP UK"), the operator of the Company's two key licences, Skipper and Blythe. This announcement follows extensive discussions with the management of ATP, which has provided IOG with considerable comfort that the objectives of the two companies are very much aligned.
ATP Oil & Gas (UK) Limited ("ATP UK") is pleased to confirm the previously announced acquisition of its shares by Alpha Petroleum (UK) Holdings Limited is scheduled to complete on Monday 10th February. The Department of Energy and Climate Change ("DECC") has confirmed in writing that conditional on completion of that acquisition the Skipper and Blythe licences, which are held jointly with Independent Oil and Gas Plc ("IOG"), will be extended by 18 months.
ATP UK and IOG both wish to progress the appraisal of the Skipper discovery expeditiously. Following technical evaluation, assisted by AGR Well Management, the co-venturers have agreed that a well spud date in summer 2014 may be achieved without compromise to safety, timing or the technical objectives for the well. This timing is subject to funding, and shareholder approval, for the co- venturers and rig availability.
The licensees also wish to achieve first gas for the Blythe Field as soon as practicable. The agreed aim is to finalise the FDP for submission to DECC in Q3 2014, secure various 3rd party agreements in respect of the Blythe export route and confirm site survey vessel availability.
Given the alignment of objectives on both Skipper and Blythe, IOG has confirmed that ATP UK will continue to receive its support as operator of both licences.
Following discussions with the operator, we now feel confident that the continued appraisal and development of our key assets will be progressed with minimal delay. This is very good news for both IOG and its shareholders. We will now have a fully funded and aligned partner. We also have confirmation from DECC of their intention to grant significant licence extensions to facilitate that. We will keep the market updated of our progress on these key assets.
In light of these important steps, we feel it is in the best interests of all parties for ATP UK to continue as operator. IOG will continue to support this work as an active and technically strong 50% partner. IOG has made significant progress towards qualifying as an operator and this will stand us in good stead with regards to opportunities in the recently announced 28th licence round and other potential acquisitions.
About Independent Oil & Gas:
IOG is an oil & gas company with established assets focused on the UK North Sea. The company’s strategy is to deliver near term development and production assets in North West Europe, through its extensive technical and commercial expertise, whilst maintaining some exposure to exploration upside. The Company is looking to grow both organically and through acquisition.
IOG has four licences in the North Sea: In addition to the Blythe and Skipper licences co-owned 50% with ATP UK, IOG has a 100% working interest in two licences awarded in the 27th licencing round. One is to the west of and adjacent to Skipper, the other is to the east of Blythe. Both these licences have potential resources that could be tied back to developments at Skipper and Blythe respectively.