Faroe Petroleum, Shell and Spirit Energy have formed a partnership with the intention of advancing an Edinburgh prospect towards a drill decision, following the award of PL 969 in the recent APA licensing round.
Through arrangements made in 2018, the licence partners have agreed to equalise equity in UK Blocks 30/14a and 30/14b in the Edinburgh area, subject to certain terms and conditions. The parties have agreed that Faroe will operate the licences until a final decision is taken, at which point Shell will become the licence operator.
Faroe holds 45% of shares across all blocks, with Shell holding 40% and Spirit holding 15%.
The large Edinburgh prospect is in the North Sea, close to the UK/Norway border in the Josephine Ridge area. The structure is a large, tilted Mesozoic fault block, which is considered to be the largest remaining undrilled structure in the Central North Sea, covering an area of over 40km².
Prospective reservoirs include the Triassic Skagerrak and Upper Jurassic Ula age-equivalent formations. Faroe estimates that the prospect will have “material volumes with potential for standalone development.”
Faroe Petroleum chief executive Graham Stewart said: “We are pleased to announce the alignment of equity in the Edinburgh Area amongst such a strong partnership, having worked to resolve the commercial impediments in the area for over eight years.
“The partnership’s combined operating experience in both the UK and Norway represents a distinct advantage in bringing the drilling of this high impact exploration prospect closer to fruition. We look forward to working with the respective UK and Norwegian authorities to progress this exciting cross-border opportunity.”
Faroe recently announced its cancellation from trading on AIM, following a hostile takeover from Norwegian oil and gas operator DNO.