Doriemus is to sell its interest in the Brockham oil licence in Surrey to the operator, Angus Energy.
If approved, the deal would increase Angus Energy’s stake in the licence, PL235, from 65% to 75%.
Earlier this month, Angus said it would abandon the Brockham oilfield if it did not get permission to reinject waste water. An application has been submitted to the Environment Agency and a public consultation is expected later this year. There has been no oil production at Brockham since October 2018.
In a statement to investors today, Angus said the purchase price for the extra stake had been adjusted to take account of outstanding amounts owed by Doriemus and a contribution towards the cost of abandoning the site.
The deal, which has to be approved by the Oil & Gas Authority, would result in a net payment to Angus of approximately £260,000, the statement said. If the transfer goes ahead, Angus said it would add a further £100,000 to the existing £350,000 abandonment reserve for Brockham.
The statement said:
“This addition reflects a modest increase in our estimate of overall costs of decommissioning and site restoration at the end of life together with Doriemus’ share thereof.”
Angus’s managing director, George Lucan, said:
“Whilst we await Environment Agency approval for water injection and the resumption of commercial production from the Portland, we continue to perform housekeeping on our eventual abandonment liabilities.”
The other investors in the Brockham licence are Terrain Energy (10%), Brockham Capital (10%) and Alba (5%).
Request to issue more shares
Angus also said it was seeking permission to allot further ordinary shares.
The company has used up most of the authority given to directors with a fundraising issue of more than 111 million shares in September 2020.
It is now calling a general meeting to remove restrictions on allotting shares up to a certain amount. The closed electronic meeting is at 11am on 9 November 2020. Shareholders may not attend and are encouraged to submit a proxy vote.