A jack-up rig is on standby near Seaton Carew, at @AbleUKLtd deep-water berth on the mouth of the river Tees. Baron Oil PLC (LON: BOIL) aim is to drill both Wick and Colter prospects back-to-back.
Baron Oil PLC (LON:BOIL) is a part of the consortiums scheduled to drill at Wick in the Moray Forth and at Colter near Poole.
Corallian, the operator of the P2235 and P1918 licenses which contain the Wick and Colter prospects, respectively, said that drilling of the Wick well would begin during December 2018
Corallian Energy, the oil and gas licence operator has estimated the Colter well contains as much as 30 million barrels of oil, to be extracted horizontally from the established Wytch Farm site in Poole Harbour.
Both are regarded as low risk, medium potential prospects, which, for now, is where Baron is focused says, says Malcolm Butler, chief executive of BOIL.
Wick is more of an unknown quantity. Again, the operator is the privately-owned Corallian Energy with the prospect adjacent to iGas’ Lybster operation in the far North East of Scotland.
Butler says it is very interesting structurally and up dip from the accumulation at Lybster, which ‘de-risks it somewhat’.
How good are the reservoirs and seals remain to be seen, but it needs to be drilled, he adds. Wick has a deeper prospect of about the same size but that is for another time says Butler. If either Wick or Colter proves to be commercial, that would have a major impact on Baron.
Baron Oil Plc soon to be ‘rolling the dice for shareholders’ at Wick and Colter
The market value at the current share price of 0.41p is just under £6mln.
At Colter, Baron is paying of 10.67% of the £7.6mln well cost to an earn 8% interest, while at Wick-it will earn 15% for 20% of the £5.7mln well cost.
If current estimates of either are confirmed by the drilling, the value would be many times higher than the current market cap.
An additional evaluation would be required and there would be infrastructure hook-up costs, but routes to funding would be considerably easier and the market value a lot higher.
Other Main players involved
Upland Resource (UPL)
Reabold Resources (RBD)
United Oil & Gas (UOG)
Andalas Energy & Power (ADL)
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