By Scott Wright

JERSEY Oil & Gas has exited two licences in the Central North Sea, citing the decision as “pragmatic and cost-effective” after evaluating the prospects and talks with the Oil and Gas Authority.

The company announced to the stock market that it has decided not to progress to the next licence phase on Zermatt and Glenn, which would have required committing to firm wells in each of the two licence areas. The licences will now automatically cease on August 29.

The move by Jersey comes after the company announced in March that its plans for its Greater Buchan Area (GBA) development, which it intends to execute in three phases, would not include Zermatt and Glenn. It flagged the “current sub-commercial status” of Glenn while noting the decision to not include Zermatt had come after taking into account the “higher ranked drill-ready portfolio of exploration of opportunities” offered by its Verbier licence. Verbier forms part of Jersey’s £1 billion project to develop a major production hub on the GBA.

Andrew Benitz, chief executive of Jersey, said: “JOG’s management has taken the pragmatic and cost-effective decision not to proceed with firm well commitments for the non-core Glenn and Zermatt licences in the context of efficient and targeted capital allocation. JOG fully respects the OGA’s Asset Stewardship Expectations which govern the delivery of exploration and appraisal work programmes, and we continue to work closely with the OGA as we progress our plans for the company’s core GBA Development project.”

Shares closed up 2.5p, or 2%, at 124p.