Trapoil confirms farm-in to Trent East Terrace

Independent oil and gas exploration company Trapoil has unveiled details of the farm-in to the Trent East Terrace (TET) Area, an operational update issued on Friday has disclosed.

The AIM-listed company, which is focused on the UK Continental Shelf region of the North Sea, confirmed details of its farm-in to the Trent East Terrace area and provided an operational update in respect of certain of its planned exlporation wells.

Trapoil stated that it had entered into a sale and purchase agreement to acquire a 33.33% working interest from Perenco UK in an area known as "License P.685" located in a region known as "Block 43/24a".

Block 43/24a is located in the Silverpit Basin in the Southern North Sea and contains the company's Trent East gas discovery.

Trapoil reported that it had committed to secure a drilling rig within six months for the planned TET appraisal well. It stated that it currently anticipated the company's share of the drilling costs would be approximately £5m as and when the well was drilled.

It stated that it intended that Trapoil would be the operator of the TET area, subject to the approval of the Department of Energy and Climate Change (DECC), which remained a condition precedent to completion of the farm-in transaction.

Mark Groves Gidney, Chief Executive Officer of Trapoil, commented: "The farm-in to the TET asset enables the group to secure operatorship, subject to DECC's approval, and therefore exercise greater control over the scheduling of our work programme.

"In addition, this relatively straight forward gas development project, in conjunction with the promising exploration potential in the adjacent acreage, offers the prospect of attractive cash flow for the group in the medium term.

Trapoil's share price was up 1.83% to 13.88p at 10:29 on Friday.

MF