Shell and UK junior Cluff Natural Resources are set to kick off exploration drilling in the North Sea soon after the pair closed a farm-in deal agreed earlier this year.
The deal has now received required regulatory consent from the Oil & Gas Authority (OGA), Cluff said on Tuesday.
Cluff will retain a 50% interest in the licence and will act as administrator until a well investment decision in made, it said.
Shell added that it aims to drill an exploration well on the Selene prospect “at the soonest possible opportunity”.
“Once a well investment decision is made, Shell will pay for 75% of the cost of an exploration well, including testing, subject to an aggregate cap of $25 million,” Cluff said.
“The UK's southern gas basin is coming under increased focus currently with several highly material exploration campaigns ongoing around our acreage. As such, we are delighted to have formally completed this farm out agreement with a committed partner such as Shell, to de-risk and ultimately drill the high-impact Selene prospect,” Cluff's chief executive Graham Swindells said.
The Selene prospect, which is considered low risk with an estimated chance of success of 39%, is located approximately 20 kilometres from infrastructure associated with the Barque gas field, which ultimately feeds the Bacton gas processing plant.
In addition, “a number of other prospects have also been identified on the block which are covered by existing seismic data and will be evaluated in due course,” Cluff said.