Xcite Energy Resources, a heavy oil appraisal and development company, has extended the P.1078 licence containing the Bentley field, in the UK North Sea.
The licence was extended until June 30, 2017, following discussions with the UK’s Oil & Gas Authority (OGA), and the Secretary of State for the Department of Energy and Climate Change (DECC).
According to Xcite, this licence extension is expected to assist the company’s current process to secure the financing required for the approval of its Bentley Field Development Plan and to repay its outstanding senior secured bonds, which are due for repayment by June 30, 2016.
The company reported it has received indicative proposals for development funding, which remain subject to agreement of commercial structuring and finalisation of due diligence, and is currently in detailed discussions to progress these proposals which, if successful, management believes would enable a fully funded first phase development plan to be submitted to the OGA in 2016.
However, Xcite noted that there was no assurance that any of these funding proposals currently being considered and negotiated would result in funding being secured by the company or, if funding was secured, the terms or timing of such funding.
The company said it has completed a technical review of the first phase of the Bentley field development with the OGA to ensure that the aspects of the plan meet OGA’s policy objectives to maximise the economic benefit to the UK of its oil and gas resources.
Xcite has also recently completed a cost review of the development plan for the Bentley field. As a result of this cost review, Excite said, the company expects the unescalated development costs to be materially reduced to approximately $30 / barrel.