Egdon Resources to acquire interest of Valhalla Oil and Gas Limited in two onshore UK petroleum exploration and development licences

Egdon Resources is to acquire the entire interest of Valhalla Oil and Gas Limited in two onshore UK petroleum exploration and development licenses. The interests to be acquired comprise 50% of PEDL180 and 50% of PEDL181, which are located in the East Midlands Petroleum Province in the County of Lincolnshire.

Egdon will grant Valhalla a net profit interest (NPI) of 10% of the acquired interest in each of the licenses. The NPI will be payable from any revenues after recovery of allowable exploration, development and production costs.

Managing director of Egdon Resources Mark Abbott said the acquisition of these licenses from Valhalla provides Egdon with access to further high potential acreage in one of the firm’s core exploration areas and reinforces its UK onshore growth strategy.

The acquisition is subject to regulatory approval from the Department of Energy and Climate Change (DECC), and approval from the joint venture partner.

The two licenses are located in the East Midlands Petroleum Province in the County of Lincolnshire. The consideration for the acquisition will be the grant to Valhalla of a net profit interest (NPI) of 10 percent of the acquired interest in each of the licenses. The NPI will be payable from any revenues after recovery of allowable exploration, development and production costs.

PEDL180, covering an area of 100 square kilometers, contains the Wressle Lead, mapped as extending into Egdon’s existing PEDL182 and located to the South East of the Crosby Warren producing oil field and between oil discoveries at Brigg and Broughton.

PEDL181, located to the East of Egdon’s existing licenses, is a large license covering over 540 square kilometers and contains among other interesting structures the Caistor Lead, defined on 3D seismic data. Both licenses are operated by Europa Oil and Gas and are subject to a drill or drop decision during 2011.

Both licenses are operated by Europa Oil and Gas and are subject to a drill or drop decision during 2011. Egdon was formed in 1997 by founding Directors Andrew Hindle and Mark Abbott.  The Company was awarded its first license in the 8th Onshore Licensing Round in 1998 and became an operator in 2000, the same year that the company moved onto the OFEX market.  In 2004 Egdon listed on AIM.

28 Jan 2011.