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Dewar Prospect Commercial Feasibility Study

Source: www.gulfoilandgas.com 7/1/2019, Location: Europe

Cluff Natural Resources Plc, the AIM quoted natural resources investing company with a high impact exploration and appraisal portfolio focused on the Southern and Central North Sea, is pleased to provide an update in relation to the commercial feasibility of the Dewar Prospect and farm-out process on licence P2352.

Commercial Feasibility Study and Farm-out Process
- An early stage feasibility study, carried out by io oil and gas consulting, has identified a viable development scenario based on a two-well subsea development, tied back to the BP operated Eastern Trough Area Project (or 'ETAP') Central Processing Facility located approximately 5km to the north west of the prospect. Other potential offtake options have also been identified as part of this study.

- On this basis, the Dewar project is estimated to have a post-tax NPV10 of 555 million and a post-tax project IRR of 123%, in a P50 prospective resource scenario.

- The Company will now look to reduce its 100% working interest in the Dewar Prospect and has commenced a formal farm-out process with the aim of attracting one or more partners to provide funding for future exploration of the block.

- The Company believes the prospect to be drill ready and expects a farm-out to be supported by a commitment to drill an exploration well on Dewar.

Dewar Prospect Highlights

- The Company was awarded a 100% working interest in licence P2352, located in a mature part of the Central North Sea, during the 30th Offshore Licencing Round in 2019.
- The Company's prospect evaluation has been based on access to recently re-processed 3D seismic data and drilling results which were unavailable to previous licence holders.
- The Dewar Prospect is estimated to contain up to 272 million barrels of light oil (P10 STOIIP) with P50 Prospective Resources of 39.5 million barrels in the Forties Sandstone. The geological model is supported by a clear AVO (Amplitude-Versus-Offset) anomaly with a geological chance of success estimated at 41%.
- The prospect is located in 90m of water and could be drilled with a heavy duty jack-up rig. Exploration well costs are currently estimated at approximately 17m (gross), including a 15 day well test.

Commenting, Cluff's Chief Executive Graham Swindells said:
"The Dewar prospect represents a significant and valuable exploration target which is located in close proximity to existing production infrastructure. The successful farm-out of two of our Southern North Sea licences to Shell earlier this year has led to a growing recognition of our technical team within the industry and provides a great platform from which to launch this next farm-out process.

We continue to invest in progressing the licences awarded in the 30th Offshore Licencing Round and remain focussed on building a portfolio of exploration and appraisal assets of varying levels of maturity which will provide further drilling opportunities, in addition to the Selene and Pensacola Prospects recently farmed out with Shell."

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