Egdon Resources plc (AIM:EDR) is pleased to announce the award by the Department of Energy & Climate Change of a licence covering offshore blocks 41/18 and 41/19 located adjacent to the North Yorkshire coast. The licence, awarded as a result of 26th UK Seaward Licensing Round, will be a Traditional Licence with Egdon Resources U.K. Limited holding 100% interest and Operatorship.

Only one well has previously been drilled in the licence area. The 41/18-1 (A339/1-2) well was drilled by Total in 1966 and was one of the earliest wells to discover hydrocarbons in the North Sea. Following acidisation, the well tested gas at rates of up to 2.5 million cubic feet of gas per day from fractured Upper Permian “Hauptdolomit” carbonates. Egdon’s preliminary evaluation indicates the potential for the drilled structure to contain substantial Prospective Resources in the range of 40 to 272 billion cubic feet of gas (“bcf”), with a mid-case of 150 bcf.

Egdon intends to re-evaluate this gas discovery through a work programme which will include the acquisition, reprocessing and interpretation of existing 2D seismic data over the blocks together with detailed analysis of the previous well results and regional geological evaluation. Contingent upon confirmation of the size of the prospect and the potential resource, Egdon intends to seek consent to drill a well from an onshore location to appraise the discovery made by the original 1966 well.

Commenting on the licence award Mark Abbott, Managing Director of Egdon said:

“We are delighted to have been awarded this 26th Round licence over these high potential blocks in one of our focus areas. We believe that our proposed approach of appraising and potentially developing this prospect via an onshore to offshore well could unlock the value in one of the earliest North Sea gas discoveries and we look forward to commencing our detailed technical evaluation.”