Xcite Energy has entered into a farm-in agreement with Azinor Catalyst Limited (Catalyst) in relation to its Licence P.1979, located on the UK Continental Shelf, near its North Sea Bentley field.
The Licence P.1979 contains Blocks 9/4a, 9/8b and 9/9h.
Xcite says that, under the agreement, Catalyst will undertake, at its own cost, a detailed technical evaluation of the Licence area, utilising interpretation techniques and integrated subsurface modelling, to further delineate and de-risk the prospects identified by Xcite on the Licence.
In return for completing this technical evaluation, and subject to approval from the Secretary of State for Energy and Climate Change, Xcite says that Catalyst will become entitled to 40% of the equity in the Licence. Following completion of this evaluation, Xcite and Catalyst will determine whether the analysis would derive additional benefit from the acquisition of an Induced Polarization survey (potential hydrocarbon indicator) to further de-risk the prospects.
If mutually agreed, the Induced Polarization survey would be fully funded by Catalyst, for which Catalyst would become entitled to a further 10% of the equity in the Licence, upon completion, Xcite said.
Rupert Cole, Xcite CEO commented: “We are very pleased to be working with Catalyst, who will be able to accelerate the technical assessment of the Licence whilst we continue to focus our core attention on the Bentley field. By collaborating with Catalyst, we believe that the evaluation of these prospects and their potential value can be undertaken in the near future, so that we can meet our obligations under the Licence.”
Nick Terrell, Azinor Catalyst Managing Director commented: “As part of our strategy of technology-led exploration in the UKCS, we are extremely pleased to have signed this agreement which further expands our footprint in the region. This transaction provides an entry point into a Licence with material and high potential prospectivity. We look forward to working with the Xcite team and maturing this exploration opportunity.”