Cash splash: Stratic Energy says North Sea exploration is too expensive for its taste
Stratic seeks slice of Bugle action
Toronto and AIM-listed North Sea player Stratic Energy said it was in talks to take part in a well to further test the Bugle discovery on Block P815, which adjoins its own holdings in the Bowmore area in the central North Sea.
Stratic said in a strategy update that it was in talks with P815 operator Nexen and its partners to drill a well close to the blocks joint boundary.
It also said it was rethinking its long-term strategy in the North Sea following the recent global economic crisis.
Stratic said its participation in the planned Bugle well, which was subject to it signing a Joint Well Agreement between all the players, would also count as the second of its two-well commitment on the licence after it sank an appraisal well on the block last year.
Stratic said Nexen was expected to spud a well on the P815 block this month using the semi-submersible Transocean Glomar Arctic IV to test a possible northern extension of the Bugle find.
The company said it had relinquished its rights to blocks 16/3d, 210/19a and 210/20a at the end of last year.
Stratic said the decision was in line with a broader strategy shift that will see it gradually drawing down its assets in the North Sea in favour of lower cost opportunities in Middle East and possibly North Africa. It would also seek to focus more on onshore plays in these areas.
As a result, Stratic said it planned to sell its undeveloped Breagh asset in the southern North Sea and Longanesi off Italy. It would continue the development of the West Don project, including the drilling of a third production well this year, and work to submit a development plan and nail down financing for its Crawford discovery by the middle of this year.
Stratic said it would complete existing exploration work in the Bowmore and Cairngorm areas, but would not seek new opportunities beyond its existing licence areas.
It said in its strategy update that the capital intensive process of developing properties in the North Sea and Italy had “proved unsustainable during the world financial crisis we have experienced over the last two years”.