Rex IH Gives Norway Drilling, License Updates
- Måns Lidgren, Chief Executive Officer of Rex International Holding
- The drilling program is subject to availability of suitable rigs (can take up to 12 months to commission), agreement and contribution of funding by concession partners and operators, regulatory approval and other factors. (RIH: Rex International Holding; NE: North Energy; *RIH has a 5.35% stake in North Energy; **pending regulatory approval; DoD: Drill or Drop; Sources: Lime Norway; North Energy website)
Rex International Holding gives drilling and license status update on its portfolio in Norway
Rex International Holding Limited, one of the largest companies listed on the Catalist of the Singapore Exchange Securities Trading Limited, shared its latest developments in its Norway portfolio, held through its 65 percent owned indirect subsidiary, Lime Petroleum Norway AS and investee company, North Energy ASA.
Måns Lidgren, Chief Executive Officer of Rex International Holding, said, “Besides growing our portfolio through farm-ins, participation in government award of licenses and investment holdings in other exploration and production companies, we also recognize the importance of having an active drilling plan. At least five licenses, in which Lime Norway and North Energy have stakes, will have exploration wells spudded in the next year. Any oil discovery in these licenses will have positive impact on Rex International Holding. To achieve a higher chance of success, we will continue to work closely with our partners to have Rex Virtual Drilling applied to determine as many drill locations as possible.”
The following is a status update on the portfolio of Lime Norway, in which the company indirectly holds a 65 percent stake:
Lime Norway has secured three wells for drilling in 2015 thus far. Lime Norway is targeting to spud in Q2 2015, licenses PL 591 and PL 591B which are operated by Tullow Oil Norge AS; in Q3 2015, license PL 708 operated by Lundin Norway AS and in Q4 2015, license PL 616 operated by Edison International Norway Branch.
Drill or Drop decisions
Decisions to drill wells or relinquish licenses will be taken for licenses PL 498/ PL 498B and PL 503/ PL 503B / PL 503C in Q4 2014 and Q1 2015 respectively. For Lime Norway’s remaining portfolio of four licenses, drill or drop decisions will be taken in 2016 and beyond.
Lime Norway is continuously evaluating farm-in opportunities to achieve more firm wells in the short term. Should Lime Norway see positive Rex Virtual Drilling results and be offered acceptable commercial terms, short-term de-risked decisions can be made to invest into pending or even on-going drilling campaigns.
As previously announced, Lime Norway relinquished licenses PL 509S, PL 509BS and PL 509CS as the anomalies detected by Rex Virtual Drilling were deemed non-attractive. Additionally, conventional mapping and electro-magnetics done by the partners were also not able to define prospects with risk-reward benefits, making drilling prospects sub-commercial.
APA Round 2014
Areas of Mutual Interest (AMI) agreements have been signed with four domestic oil companies and three international oil companies. Lime Norway will cooperate with its AMI partners for application of new licenses in the next Awards in Pre-defined Areas (APA) round. Lime Norway is targeting 8 to 10 applications before the submission deadline of September 2, 2014. The award of new licenses is expected to be announced in February 2015.
North Energy, in which the company has a 5.35 percent interest, has secured 20 percent participation stakes in two additional licenses PL 713 and PL 510, in which Lime Norway does not have any equity interest.
North Energy will participate in the drilling of a well in license PL 713 in Q4 2014. This well is operated by Statoil Petroleum AS and will be drilled using the semi-submersible Transocean Spitsbergen.
In Q1 2015, North Energy will participate in the drilling of a well in license PL 510. This well is operated by Maersk Oil Norway AS and will be drilled using the semi-submersible Leiv Eriksson.