Talon Petroleum Limited (ASX: TPD) is an oil and gas company which released its Investor Presentation -121 Oil & Gas Investment Conference Hong Kong. TPD presented the UK North Sea strategy overview following the acquisition of EnCounter Oil in the same region driven by the objective to scale up its assets portfolio within the North Sea. Below are some highlights of the presentation as reported:
UK North Sea Overview –
The North Sea is a world-class oil province with over 50 years of history in oil and gas production and ~43 billion barrels of oil and gas recovered. The provinces have abundant and world-class infrastructure which allows for reductions in capital expenditure used for infrastructure development. Talon stated that several promising opportunities are available within the region along with increased activity and regular bid rounds for further acreage capture. OGA has recently advised about the finding costs in the region which were just over $1 per barrel in 2018.
TPD aims to utilise important technical expertise for the early stage entry through bidding rounds or farm-out for carry. The core objective of the company is to drill multiple wells per calendar year with drilling fundamentals of low-risk exploration and appraisal of known discoveries. TPD intends to become a partner of choice for well-known companies within target areas of the North Sea. The region has low sovereign risk jurisdiction along with stable, supportive regulatory environment and solid fiscal terms.
Acquisition of EnCounter Oil –
The acquisition of EnCounter Oil delivers 100% interest in two high-quality exploration licenses. Graham Dore and Paul Young, two highly experienced North Sea oil explorers have joined TPD’s team. EnCounter was formed by former members of EnCore Oil PLC. Some of the discoveries by EnCore Oil include Breagh, Cladhan, Catcher, Varadero and Burgman. Premier Oil acquired EnCore Oil in 2011 for GBP 222 million.
Investor Presentation (Source: Company Announcement)
Talon Portfolio –
The company’s Talon portfolio currently includes three prospects Skymoos, Rocket and Curlew-A Appraisal:
Skymoos (107mmbo best estimate prospective resource) – The Upper Jurassic Buzzard Field which is UK North Sea’s largest producing oil field has direct analogue to the prospect. It is also imaged on high-quality 3D seismic with large Jurassic age stratigraphic trap. In addition, the farmout process is underway for this prospect.
Skymoos Location (Source: Company Announcements)
Rocket (27mmbo best estimate prospective resource) – The prospect has a direct analogue to amplitude supported oil fields to the north-east. It is imaged on excellent quality 3D seismic. This prospect consists of shallow, lost- cost drilling of high-quality tertiary reservoirs along with low-cost tieback to existing infrastructure.
Skymoos Location (Source: Company Announcements)
Curlew-A Appraisal – TPD has a 10% interest in 45mmboe 2C discovery. It is in Cromarty Sandstone, which also houses several major discoveries. Shell discovered appraisal of significant Tertiary aged oil in 1979. The Appraisal has high-quality shallow oil in the good quality reservoir along with low cost, low-risk appraisal of discovered oil. Additionally, the drilling is planned for Q4 2019.
Skymoos Location (Source: Company Announcements)
TPD Price at posting:
0.3¢ Sentiment: Buy Disclosure: Held
Investor Presentation (Source: Company Announcement)
