The KLW Gas Discoveries are a series of shallow-water gas accumulations that were discovered between 1992 and 2009 by the then operators and successfully drill-stem tested confirming discovered volumes that Oilex and Koru would seek to bring into production, should the acquisition complete.
The KLW Gas Discoveries are ideally located very close to a subsea tie-back pipeline, owned and operated by Spirit Energy, which delivers gas to the nearby and recently refurbished North Morecambe Gas Production Platform and Terminal.
The East Irish Sea (EIS) is a prolific basin which has produced more than 6TCF of gas to date with considerable existing gas production, gathering, processing and transportation infrastructure.
Koru holds the exclusive right to acquire a 100% interest in UK Seaward Production Licence P2459, Block 113/28a (Knox) and 113/29a (Lowry) and P2444 Block 110/3b (‘Whitbeck’).
It is currently proposed that Oilex will enter into an agreement with Koru pursuant to which Oilex would acquire a 50% interest in the licenses and the KLW Gas Discoveries for cash consideration of £500,000.
The licenses would be held on a 50/50 basis between Oilex and Koru under a joint venture structure., with Koru as the operator.
Oilex has paid a non-refundable £50,000 exclusivity fee to Koru.
The Knox and Lowry gas discovery projects are well advanced having successfully flowed gas when drill stem tested with reported raw gas flows of 12.3 MMCFD and 22 MMCFD, respectively.
The main reservoir interval in the EIS and in each of the KLW Gas Discoveries is the prolific Lower Triassic Ormskirk Sandstone Formation.