Fastnet Awarded Licensing Options over Celtic Sea Blocks (Ireland)

Fastnet Awarded Licensing Options over Celtic Sea Blocks (Ireland)

Fastnet, the newly listed E&P company focussed on near term exploration acreage in the Celtic Sea and Africa, was notified on 11 June 2012 by the Petroleum Affairs Division of the Irish Department of Communications, Energy and Natural Resources (“PAD”) that it has been awarded licensing options (“Licensing Options”) over block 50/26 and part blocks 49/25, 49/30, 50/21 and 50/22 in the Molly Malone basin in the North Celtic Sea and blocks 55/14 and 55/15 and part blocks 55/9 and 55/10 in the Mizzen Basin in the South Celtic Sea, offshore Ireland.

Details of the Licensing Option awards

Molly Malone Basin

The basin is located within the Celtic Sea Basin in water depths of up to 100 metres. The licensing option covers block 50/26 and part blocks 49/25, 49/30, 50/21 and 50/22 in the North Celtic Sea basin.

The Company believe that this basin offers an opportunity to develop an exploration concept incorporating all the elements of a working petroleum system tested in adjacent areas offshore southeast Ireland, such as the Fastnet Basin, and  onshore England, such as the Wessex basin (containing Wytch Farm oil field – the largest onshore oil field in Western Europe). The directors of the Company (“Directors” or “Board”) believe (as stated in the Company’s AIM Admission Document (“Admission Document”)), based entirely on their own internal estimates, that this licence area could contain in-place resources of as much as 1 billion bbls.

Currently, there are no wells in the application area and there is only sparse 2D seismic coverage available. Fastnet has been awarded an 18 month Licensing Option. During that period the Board, in accordance with the minimum phase 1 work programme intends to purchase, reprocess and interpret some of the existing 2D seismic data, undertake regional seismic correlation work and to refine the model of the petroleum system. Subject to results, Fastnet would move to acquire 3D seismic data.

Mizzen Basin

This basin is located within the Celtic Sea Basin in water depths of up to 160 metres. The licensing option covers blocks 55/14 and 55/15 and part blocks 55/9 and 55/10 in the South Celtic Sea basin.

The Board believes that the basin offers an opportunity to develop a play incorporating all the elements of a working petroleum system tested in adjacent areas offshore Ireland and in the analogous basins, offshore eastern Canada. The Board also believes (as stated in the Admission Document), based entirely on its own internal estimates, that this licence area could host in-place resources of as much as 1 billion BOE.

Currently, there are no wells in the application area but there is 2D seismic coverage, albeit requiring reprocessing. Fastnet has been awarded an 18 month licensing option. In accordance with the minimum Phase 1 work programme,  during that period the Board’s initial intention is to purchase, reprocess and interpret some of the existing 2D seismic data, generate regional seismic ties and refine the model of the petroleum system. Subject to results, Fastnet would move to acquire 3D seismic data.

In relation to both the Licensing Options in respect of the Molly Malone and Mizzen Basins, a study of primary reservoir and seal development, amongst other things, and preparation of a final technical report, will be carried out during the initial 18 month Licensing Option period.

A final report of the Company’s work on the licence areas needs to be submitted by 31 October 2013 and include the geology of the option area and an evaluation of each prospect or lead identified.

Other applications made

As set out in the Admission document the Company also applied for Licensing Options over certain blocks in the Fastnet Basin of the Celtic Sea. In addition to the above, the Company was notified yesterday by the PAD that its application was unsuccessful in relation to these blocks.

The Company also lodged an application for an onshore shale gas exploration licence in the Dublin Basin. As expected by the Board, the PAD has notified the Company that it has decided not to offer a Licensing Option at this time to any applicant.

General

The working capital requirement arising in respect of the work programme under the Licensing Options is expected to be approximately €1 million. The Company has countersigned the Licensing Option agreements and submitted them to

the PAD along with its application for a Petroleum Prospecting Licence.

Dr.Steve Staley, CEO of Fastnet commented:

“I am very pleased to announce the award of these two highly prospective licence areas in the Celtic Sea, one of our key focus areas and which has received a lot of attention recently due to the recent successful appraisal of the large  Barryroe discovery.

“To have been granted these two licence options so soon in the Company’s development is testament to the team we have in place and the future potential of the business. I look forward to bringing shareholders further news on the Molly  Malone and Mizzen licence areas as and when appropriate.”

Source: Fastnet, June 12, 2012

 

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