By Scott Wright
CANADA-based i3 Energy has declared its plans to start drilling on the Serenity oil field in the Moray Firth are on track, as it predicted continuing volatility in the global energy market.
The company, which is listed in Toronto and London, completed a farm-in deal on Serenity this month, paving the way for the appraisal well to be spudded. Europa Oil & Gas secured a 25 per cent working interest in a licence block containing the Serenity field in the Outer Moray Firth on August 1. In exchange, Europa will fund 46.25% of the drilling cost on Serenity, up to a gross capped cost of £15 million.
i3 had previously held a 100% working interest in the Moray Firth block, which in addition to Serenity includes the Liberator oil discovery and the Minos High prospect. The company notes on its website that the licence is situated between the producing Captain field to the north-west, and the producing Blake field to the east.
Drilling on the Serenity appraisal well will allow i3 to update its estimate of oil in place, which currently ranges from 16 million barrels in the low case to 240 million barrels in the high case.
The update came as i3, which has an asset base of more than 700 net conventional oil, natural gas and natural gas liquids production wells in Canada, made major strides in revenues, cash flow and production in the six months ended June 30. Revenue surged to £101.6 million from £26.5m and cash flow from operations climbed to £48.6m from £8m. That came as production averaged 18,950 barrels of oil equivalent per day, 107% higher than in the first half of 2021.
Dividends totalling £6.85m, or 0.6p per share, were announced in the first half. i3 announced in May that it would be increasing dividends payable during 2022 by 25% to £14.78m, equating to 1.3125p per share.
Chief executive Majid Shafiq said: “We are very pleased to announce a solid set of results for the first half of the year.
“These reflect the hard work of our staff in Canada and the UK in successfully progressing our business plan on all fronts. We have made great strides in executing efficiently on our operated drilling program in Canada, with all wells drilled being on prognosis geologically and production contributions now commencing following tie-ins to infrastructure.
"We are also very happy to bring in a partner to the Serenity oil field in the UK and plans to drill the appraisal well are on track to spud this month.”
Shares closed down 2% at 24.5p.
Why are you making commenting on The Herald only available to subscribers?
It should have been a safe space for informed debate, somewhere for readers to discuss issues around the biggest stories of the day, but all too often the below the line comments on most websites have become bogged down by off-topic discussions and abuse.
heraldscotland.com is tackling this problem by allowing only subscribers to comment.
We are doing this to improve the experience for our loyal readers and we believe it will reduce the ability of trolls and troublemakers, who occasionally find their way onto our site, to abuse our journalists and readers. We also hope it will help the comments section fulfil its promise as a part of Scotland's conversation with itself.
We are lucky at The Herald. We are read by an informed, educated readership who can add their knowledge and insights to our stories.
That is invaluable.
We are making the subscriber-only change to support our valued readers, who tell us they don't want the site cluttered up with irrelevant comments, untruths and abuse.
In the past, the journalist’s job was to collect and distribute information to the audience. Technology means that readers can shape a discussion. We look forward to hearing from you on heraldscotland.com
Comments & Moderation
Readers’ comments: You are personally liable for the content of any comments you upload to this website, so please act responsibly. We do not pre-moderate or monitor readers’ comments appearing on our websites, but we do post-moderate in response to complaints we receive or otherwise when a potential problem comes to our attention. You can make a complaint by using the ‘report this post’ link . We may then apply our discretion under the user terms to amend or delete comments.
Post moderation is undertaken full-time 9am-6pm on weekdays, and on a part-time basis outwith those hours.
Read the rules here