Melrose Resources farms out Black Sea concession

Newsroom 10/09/2012 | 11:20

UK-based Melrose Resources has agreed to farm-out 30 percent of its equity in the Est Cobalcescu exploration concession, based in the Black Sea, to the local subsidiary of Australian oil and gas firm Beach Energy.

Beach will pay around USD 4.8 million to Melrose Resources, which represents a proportionate share of past license costs and of a 3D seismic survey.

Melrose Resources will retain operatorship and a 40 percent working interest in the concession, once the deal is closed. Meanwhile, Beach and Romanian Petromar Resources each hold a 30 percent stake in the concession offshore Romania.

“Both licenses offer material exploration potential in an under-explored region of the Black Sea, however, it is prudent at this stage to share some of the investment risks on the multi-well drilling program planned on the blocks over the next two years,” said David Thomas, chief executive officer of Melrose Resources. The oil firms plans two wells in 2013 and four wells in 2014.

Melrose Resources said this deal will reduce its capital budget by around USD 8.4 million and the drilling costs by an estimated USD 16 million over the next two years.

The deal is pending approval from the Romanian National Agency of Mineral Resources.

Melrose Resources holds a 40 percent stake in the Muridava and Est Cobalcescu concessions offshore Romania. The oil and gas firm registered a first half profit of USD 32.7 million, down 1.5 percent from the same period of last year.

Ovidiu Posirca

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