Valiant Petroleum plc announces that its wholly owned subsidiary, Valiant Exploration Limited, has reached a series of agreements to farm-down and swap part of its 100% holding in blocks 210/29c and 210/30b which contain the Cladhan South prospect(s) (“Cladhan South”) and sit directly to the south and east of the existing Cladhan discovery.
The three separate transactions are with Sterling Resources (U.K.) Ltd (“Sterling”), Wintershall (UK North Sea) Limited, both of whom are existing equity holders in the original Cladhan discovery, and Agora Oil and Gas (UK) Limited. As a net result of the separate transactions, Valiant will hold:
· A 30.0% interest in Cladhan South promoted for the full cost of an initial exploration well, subject to an agreed cap on the promoted costs; and
· A 40.0% interest in Blocks 21/30f and 22/26c located in the Central North Sea operated by Sterling which contain a number of exploration and appraisal opportunities.
Following completion of the Transactions, Sterling will become operator of Cladhan South bringing with it strong subsurface knowledge of the area following the original Cladhan discovery in 2008 and subsequent appraisal in 2010. Further appraisal on Cladhan is currently underway and is likely to provide more information regarding the prospectivity of Cladhan South.
Sterling has informed Valiant that it is currently seeking a rig slot for the second half of 2011 in order to drill Cladhan South as part of its exploration and appraisal program in the area this year.
The Transactions remain subject to a number of conditions precedent including final award of Blocks 21/30f and 22/26c to Sterling and approval of each of the transactions by the Department of Energy and Climate Change.
Peter Buchanan, CEO, commented:
“The series of transactions announced today give Valiant exposure to a near term exploration well on this exciting play in its core Northern North Sea area while also expanding its portfolio further in the Central North Sea. We look forward to working together with our new partners and benefiting from their extensive knowledge gained in the area from the drilling to date which has taken place on the Cladhan discovery.”
Source:Valiant, March 8, 2011; Image: Sterling