20 Jul 2016
Skipper UpdateIndependent Oil and Gas plc ("IOG" or the "Company"), the development and production focused Oil and Gas Company, is pleased to provide an update on the drilling of the appraisal well on the Skipper oil discovery which lies in Block 9/21a in licence P1609 in the Northern North Sea. The Skipper appraisal well, of which IOG is 100% owner and operator, will be drilled by Transocean's Sedco 704 semi-submersible drilling rig which is now on contract with IOG and is being towed to the drilling location. Operations are anticipated to commence on 22 July 2016.
Further to the announcements on 7 December 2015 and 11 December 2015, the loan agreements signed with GE Oil & Gas UK Limited for £2 million and London Oil & Gas Limited, part of London Group plc for £2.75 million and £0.8 million have been extended to 20 December 2017, in line with a number of other service and equipment contractors on deferred payment terms for all or part of their costs on the Skipper well. No fees have been levied or further warrants granted in achieving this extension.
It was previously announced on 14 July 2016 that from 19 July 2016, the number of Ordinary Shares in issue would be 101,546,680. The correct amount is 101,728,498 Ordinary Shares and this number should be used by shareholders going forward as the denominator for the calculations by which they will determine if they are required to notify their interest in, or a change to their interest in the Company under the FCA's Disclosure and Transparency Rules.
About Independent Oil and Gas:
IOG is an oil and gas company with established assets in the UK North Sea. The company's strategy is to deliver near term development and production assets in North West Europe, through its extensive technical and commercial expertise, whilst maintaining some exposure to exploration upside. The company is looking to grow both organically and through acquisition. Following completion of the Blythe acquisition, the Company's combined estimate of 2P reserves in Blythe and 2C resources in Skipper net to IOG will be 40.2 MMBoe.
Further information can be found on www.independentoilandgas.com
The Skipper oil discovery is in Block 9/21a in the Northern North Sea in licence P1609. IOG owns 100% of the Skipper licence P1609 and is the Operator. The Skipper appraisal well objective is to retrieve a reservoir condition oil sample in order to design the optimum Skipper field development plan. Skipper has independently verified gross 2C resources of 26.2 MMBbls. IOG management estimates that the recoverable oil from Skipper is 34.1 MMBbls based on a recovery factor of 25%, compared to the historic CPR estimate of 19%. Successful flow tests from nearby heavy oil fields substantiate the company's estimate of a 25% recovery factor. The appraisal well will also target two exploration prospects directly beneath the Skipper oil discovery which may contain oil in place of 46 MMBbls. (Source: AGR Tracs CPR dated September 2013.)
Competent Person's Statement:
In accordance with the AIM Note for Mining and Oil and Gas Companies, IOG discloses that Mark Routh, IOG's CEO and Interim Executive Chairman is the qualified person that has reviewed the technical information contained in this announcement. Mark Routh has an MSc in Petroleum Engineering and has been a member of the Society of Petroleum Engineers since 1985. He has over 35 years' operating experience in the upstream oil and gas industry. Mark Routh consents to the inclusion of the information in the form and context in which it appears.