P2437 - Selene

The Selene prospect, with gross P50 prospective resources of 318 BCF, is one of the largest undrilled structures in the world class Permian Leman Sandstone Fairway.

Following the 2019 farm-in by Shell, the JV is scheduled to drill an exploration well on the Selene structure in mid-2024 with enabling works commencing in the autumn of 2023.

In February 2024 Deltic farmed down 25% of its licence interest to Dana Petroleum.

Equity

25%

Location

Southern
North Sea

Size

228kmĀ²

Operator

Shell

Resource Summary

Licence Ref Deltic Equity Prospect Type PRMS Status Net Prospective Resources (BCF) Chance of Success %
P90 P50 P10
P2437 25% Sloop Permian Discovery 2 5 10 100
Selene Prospect 33 80 145 69
Endymion Lead 9 12 16 27
Rig and Jib Lead 3 8 15 35

Selene Prospect

The Selene prospect is located on the northern limb of the Sole Pit Basin inversion axis and takes the form of a NW-SE elongated closure. The prospect is formed by two south-west dipping fault blocks.

Well 48/08b-2 was drilled down-dip of the Selene prospect, near or on major faults, contributing to its lower than regional trends reservoir quality. During geological uplift these faults likely transmitted fluids, which led to minerals precipitating into the reservoir pore spaces, resulting in 48/08b-2 being classed as a dry well despite seeing up to 4.9% gas peaks in the Leman Sandstone.

In February 2024, Deltic farmed down a further 25% of its interest in P2437 to Dana Petroleum (E&P) Limited. This transaction, in combination with the existing Shell carry, results in Deltic retaining a 25% non-operated interest in Licence P2437 and having no exposure to 2024 drilling and testing costs up to a cap in excess of current success case well cost estimates ($47M), provided by the Operator.

The deal also includes $500k in cash on completion in relation to back costs incurred by Deltic. Dana will carry Deltic for its residual cost exposure to the Selene well (after utilisation of the existing carry from the Shell farm-out) to a value of $5M, and $6M in a success case.

Dana will pay its 25% share of costs from 1 January 2024 and completion of the deal was on 2 April 2024.

Shell Farm-in to P2437

On 30th April 2019 the Company announced that Shell exercised their option on Licence P2437 and specifically the Selene prospect. Following completion of the transaction in August 2019, Deltic have transferred a 50% working interest in Licence P2437 to Shell in return for a cash sum of USD$600,000 and Shell funding 75% of the costs of the first exploration well to be drilled on the licence up to a gross well cost of USD$25M. In July 2022 the Partnership committed to drill an exploration well on the Selene structure.

Endymion Prospect

Straddling blocks 48/08b & 03, the Endymion prospect is a structural closure at Leman Sandstone. The structure is formed by the extension of the fault system that creates the Mimas field, on strike to the southeast and is separated from Mimas by a low. With success at Selene, Endymion is seen as a follow-on opportunity due to its proximity to infrastructure.

Sloop Discovery

Well 48/08A-1 well discovered Sloop in 1989, a Lower Leman gas bearing sand in a heavily faulted structure. A 209.7m gross Leman Sandstone was encountered with certain sections reaching 12% porosity. Log analysis suggests a gas-water contact at 2908m TVDSS. The discovery has a gas initially in place of 17 to 54 BCF.

Next Steps

  • Continue preparatory works for the Selene exploration well
  • Commence contract and mobilisation of Valaris 123 heavy duty jack-up rig in June-July 2024
  • Drill Selene exploration well in Q3 2024