Rex International unit to acquire 17% interest in North Sea oil and gas field licence

REX International : 5WH 0%’s subsidiary Lime Petroleum will acquire a 17 per cent interest in PL740, an oil and gas licence for a field in the Norwegian North Sea, the group said on Tuesday (Nov 7).

Its subsidiary entered into sale and purchase agreements with DNO Norge for a 10.7212 per cent interest in PL740 and OKEA for a 6.2788 per cent interest.

The group expects the Brasse field, which falls under the licence, to commence commercial production in 2027. OKEA, the operator of the licence, estimated the recoverable resources in the field to be around 21 to 29 million barrels of oil equivalent (mmboe).

This was based on a recently published environmental impact study for the field – of which 25 per cent to 30 per cent is gas.

Rex said the farm-in of its 17 per cent interest in PL740 could result in four mmboe of contingent resources net to Lime. The farm-in is conditional on customary government approvals, which Lime estimates will take place at the end of 2023 or early 2024.

Lime Petroleum chief executive Lars Hubert said the farm-in is a further extension of the company’s strategy to build value by adding reserves and production, following its acquisitions of interests in the producing Brage field in 2021 and Yme field in 2022.

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“Through our participation in the Brage field, we know the area very well,” he added, noting that the Brasse field development would have significant synergies with Brage. This would likely extend the lifespan of its Brage field and add to Lime’s cash-flow stream in the long term.

Shares of Rex closed flat at S$0.173 on Monday.