East Midlands Shale Stakes Sell for Modest Sums

UK privately owned onshore explorer Celtique Energie has agreed to sell its entire interests in two East Midlands shale gas and oil exploration licences for relatively low sums.

Union Jack Oil and Humber Oil & Gas will each acquire a 16.25% in PEDL201 (Widmerpool Gulf) south of Nottingham, and 12.5% of PEDL181 (Humber Basin) on the south side of the Humber estuary. According to Union Jack, which announced the deals May 15, each of the four transactions is worth £7500 cash. Neither licence has been recently drilled.

It contrasts with high multi-million deals at the peak of interest in UK shale back in 2014; last year however Engie divested its UK shale interests to Ineos in what may have been a zero-cash transaction.

On completion, interests held in PEDL201 will be operator Egdon Resources 45%, Union Jack 26.25%, Humber 16.25% and Terrain Energy 12.5%; for PEDL181 they will be operator Europa Oil & Gas 50%, Egdon 25%, with Union Jack and Humber each 12.5%. PEDL201 covers 19,768 acres while PEDL181 covers 39,314 acres (both at 100% equity).  Union Jack said its deals represent “significant value upside”.

UK explorer IGas expects to spud, but will not frack, its first shale well in north Nottinghamshire (also in the English East Midlands) in mid-2018, while in northwest England Cuadrilla has an active drilling and fracking campaign underway which earlier this month it said 'in a best case scenario' might produce shale gas from 2019 onwards.