Orcadian notes the significant rise in the Company’s share price today. The Board confirms that it is not aware of any specific reason for this increase.
The Directors are aware of the positive support given by the UK Government on 31 July 2023 to the future of the oil and gas industry focussed on the UK Continental Shelf. The UK Government has confirmed that it intends to proceed with awards of licences in the 33rd Round. As announced on the 19 January 2023, the Company applied for three licences in the 33rd Round. The Company has completed its NSTA interviews and remains optimistic that licences may be offered in due course, but there can be no guarantee that any licences will be offered to the Company. In addition, the Government’s clear support for further development of oil and gas in the UK is very welcome, and provides a supportive background to the Company’s discussions with potential partners.
The Company’s focus is as documented in the Company’s interim results announcement dated 30 March 2023. The Company is looking to find a farm-in partner or a new owner for Pilot and the Directors intention is to elicit offers during 3Q of 2023 so that a new operator can take the project forward. The Company is continuing discussions with a number of oil and gas operators interested in partnering in the development of Pilot, or acquiring the Pilot Licence, and/or partnering with Orcadian to re-apply for the area covered by the former P2320 licence. As set out in the announcement of 30 March 2023, whilst the Company is considering all options at this stage, any disposal of Licence P2244 and the Pilot project would likely be a fundamental change of business for Orcadian pursuant to Rule 15 of the AIM Rules for Companies. Such a disposal would therefore be conditional on the consent of shareholders; and require both an announcement and the publication of a shareholder circular detailing the potential disposal. However, there can be no guarantee that any transaction will occur. Further updates will be provided as required.
As also previously indicated to the market, the Company needs to raise new finance in the short term for working capital and to repay the loan facility with Shell of c. £1m due for repayment at the end of August 2023. In the meantime, the Company’s working capital remains severely constrained. Cash at the end of July 2023 was £97k. A number of conversations are progressing with potential providers of finance but there can be no guarantee that any financing arrangements will be entered into.
For further information on the Company please visit the Company’s website: https://orcadian.energy
