Private Blog, 13 March 2022
Financial and promotional perspectives
13 March 2022
Companies of interest:
Deltic Energy (DELT) moved higher to 3.2p, around twice the level at which the private blog first started covering the company last year. Deltic has farmed-out five of its gas licences in the Southern North Sea to Capricorn Energy, which has acquired a 60% interest in licences P2428 and P2567, and a 70% interest in licences P2560, P2561 and P2562 in return for funding 100% of an agreed work programme for each of the five licences up to the point of making a drill or drop decision on each licence and paying $1 million towards historic back costs. In the event that a drilling decision is made on either of P2428 and P2567, which contain the most advanced prospects, Cairn will fund 70% of the costs of whichever well is drilled first, subject to a gross well cost cap of $25 million. In the meantime, Pensacola remains scheduled to be spud in the second quarter and Deltic is fully funded for its 30% interest. Per the company, the Pensacola prospect contains gross P50 prospective resources of 309 billion cubic feet of gas (with a P90-P10 range of 39 billion cubic feet of gas to 1,181 billion cubic feet of gas), which will rank Pensacola as one of the highest impact exploration targets to be drilled in that basin in recent years. Geological chance of success associated with the prospect has been assessed by the Shell/Deltic JV at 55%. Market capitalisation is £45 million.