Europa
Oil & Gas (Holdings) plc / Index: AIM / Epic: EOG / Sector: Oil
& Gas
31 January 2025
Europa Oil & Gas
(Holdings) plc
("Europa" or the
"Company")
Operations
Update
Europa Oil & Gas (Holdings) plc,
the AIM quoted UK, West Africa and Ireland focused oil and gas
exploration, development and production company, provides an
operational update on its current activities and outlook for
2025.
Equatorial Guinea
In Q4 2024, the Company, through its
42.9% shareholding in Antler Global ("Antler"), initiated a farmout
process for its EG-08 asset which has an internally estimated 2.2
TCF Pmean of gross prospective resources[1]. Since beginning the farmout process, there has
been significant interest in the asset and discussions continue
with a number of potential farminees. Europa is aiming to
receive offers to provide Antler with a full carry on an
exploration well targeting the c.900BCF Barracuda prospect in H1
2025.
Ireland
Europa has a 100% interest in
licence FEL 4-19, which contains the 1.5 TCF Pmean[2] Inishkea West gas prospect. The Company continues
to look for a partner to drill an exploration well on the prospect,
where Europa believes that a successful discovery has the potential
to supply at least two thirds of Ireland's gas demand in 2030. The
asset is adjacent to the producing Corrib gas field, which is one
of the lowest carbon-intensity gases in Europe, much lower than UK
imported gas. With compelling economics, which Europa believes will
result in a post-tax NPV10 of US$2.0 billion[3], and a carbon emission intensity of 2.8 kilograms
per boe, compared to 36 kilograms per boe for UK imported gas
during 2022[4], the prospect provides a
farminee with a very attractive risk reward proposition. The newly
elected Irish government appears to be concerned about security of
energy supply and as such it is hoped that they will be supportive
of the domestic upstream sector.
UK
Cloughton Appraisal
Progress on Cloughton (Europa
interest 40%) has been steady during the year and the Company
intends to submit a planning application for the Cloughton
appraisal well during Q1 2025. The multitude of independent reports
that have been commissioned to support the planning application
highlight that the chosen pad location is ideal for this well and
for a potential development of the 192 BCF GIIP, should the
appraisal well prove that commercial rates are achievable. Europa
expects to shoot a seismic programme towards the end of 2025 with
appraisal drilling forecast to commence early 2026.
A dedicated website is currently
under construction that will provide all stakeholders with
information about the well, including planning reports, well data,
G&G information, impact on traffic, emissions, and much more. A
further announcement will be made when this site is
launched.
Onshore Production
Europa continues to benefit from the
strong performance of the Company's onshore UK producing assets,
particularly the Wressle oilfield in the East Midlands (Europa
working interest: 30%) which continues to produce at the top end of
the CPR production forecast. The Company's total UK net production
in December 2024 averaged over 124bopd and Europa anticipates an
active year for Wressle, with a development well planned to be
drilled for the Penistone horizon in H2 2025 (subject to necessary
permits and consents) and preparation for a second Penistone well
and Broughton North exploration well to be drilled in
2026.
The Wressle production is
complemented by a gas monetisation solution that will be developed
in parallel with the Penistone well. The gas monetisation solution
is expected to enhance production from the field and substantially
increase revenues, as well as eliminate routine flaring from the
Wressle field.
The Company is also looking at
optimising production operations at its Crosby Warren site (Europa
working interest: 100%), where the existing production could be
significantly increased through a simple workover programme that is
currently being considered. The workover will likely be conducted
during 2025.
New
Business
The Company continues to assess new
opportunities, particularly in West Africa where projects provide
significant value-accretion that are within the Company's financial
capability.
2025 Budget
The Europa 2025 calendar year budget
shows an unrestricted[5] cash position of
£0.96m as of 31 December 2024 and forecast G&A of £1.68m
(reduced from £2.23m budgeted for 2024). The majority of
capex for the year is forecast to be spent on Wressle with the
balance being spent on Cloughton, Crosby Warren and FEL
4/19.
Project finance discussions to fund
the Wressle capex are underway, although there is no guarantee that
this will be secured. Should Wressle project financing be secured,
or if Wressle operations are delayed beyond 2025, then the Company
forecasts that it has sufficient funds, from existing cash and
forecast profits from existing operations, to cover all costs and
other capex. Operations for Equatorial Guinea are fully funded for
2025 with the funds already held in the Antler subsidiary.
Will Holland, Chief Executive Officer of Europa,
said:
"2025 will undoubtedly be an active year for Europa as we
progress with multiple projects that have the potential to deliver
significant value to shareholders.
I
am encouraged by the response that we have had to our EG-08 farm
out process. The compelling technical merits of a material gas
resource with a 70-80% chance of success located 9km from existing
infrastructure in a stable region with a favourable fiscal and
operating environment is understandably attracting significant
interest from multiple parties. I look forward to updating the
market on this exciting asset as we progress associated
workstreams.
In
Ireland, I hope that the new administration continues to build on
its support for improving Ireland's security of supply and that
this will manifest itself as support for our Inishkea West
prospect, which is ideally placed to be quickly brought online via
the existing infrastructure.
Progress on Cloughton has been steady during 2024 and we
expect to continue with this momentum during 2025 as we secure the
necessary approval to drill the appraisal well in 2026. With 192
BCF GIIP located onshore close to existing infrastructure it can be
brought online quickly, with minimal disruption to the local
community, and could be a vital source of domestic low emission gas
displacing high emission LNG imports.
We
are optimistic that all necessary approvals and permits will be
obtained for the Wressle development programme to start around
mid-2025. The programme will not only develop the Penistone horizon
of the field but also monetise the gas by connecting to the local
gas network which we believe will result in a material increase in
production and cashflows.
The Europa Board adopts a prudent approach, balancing the
inherent risks associated with exploration, appraisal and
development against the value creation of these upstream
activities. Our 2025 budget reflects this risk assessed
value-driven approach and I look forward to updating the market on
our progress throughout the year."
Qualified
Person Review
This release has been reviewed by
Alastair Stuart, Europa's Chief Operating Officer, who is a
petroleum engineer with over 35 years' experience and a member of
the Society of Petroleum Engineers and has consented to the
inclusion of the technical information in this release in the form
and context in which it appears.
* * ENDS *
*
For further information, please
visit www.europaoil.com or
contact:
|
William Holland
|
Europa Oil & Gas (Holdings)
plc
|
mail@europaoil.com
|
|
Samantha Harrison / Ciara Donnelly /
Elliot Peters
|
Grant Thornton UK LLP - Nominated
Adviser
|
+44 (0) 20 7383 5100
|
|
Peter Krens
|
Tennyson Securities
|
+44 (0) 20 7186 9033
|
|
Patrick d'Ancona / Finlay Thomson /
Kendall Hill / Anna Stacey
|
Vigo Consulting
|
+44 (0) 20 7390 0230
|
