Serica Energy plc

Serica Energy plc

June 30, 2011 13:47 ET

Serica Energy: Licence Acquisition

LONDON, UNITED KINGDOM--(Marketwire - June 30, 2011) - Serica Energy plc (TSX:SQZ)(AIM:SQZ) reports a Licence Acquisition.

Serica has a 30% interest in Block 15/21g (P1655) and today EnCore Oil plc as operator made the following announcement regarding the adjoining Block 15/21a (P218):

"Block 15/21a (P218)

EnCore Oil plc (LSE:EO) and its P1655 (Block 15/21g) partners, Nautical Petroleum plc and Serica Energy plc (the P1655 group), announce they have agreed terms to acquire a 70 per cent. interest in a part of adjoining Licence P218 (Block 15/21a). P218 is currently operated by DEO Petroleum with co-venturers, Faroe Petroleum plc, Maersk Oil UK Ltd and Atlantic Petroleum (the P218 group). The area in P218 to be acquired includes the 15/21a-38z Spaniards/Gamma discovery well, drilled in 1989 by Amerada Hess, which flowed 2,600 bbls/day of 26 API oil on test. In consideration, the P1655 group have agreed to assign the P218 group a 30 per cent. interest in P1655, and have agreed to fund the cost of the first well to appraise the Spaniards/Gamma discovery. It has also been agreed that a subsequent appraisal well, if deemed necessary and approved by the partnership, would be funded on promoted terms by the current P218 partners as shown in the table below, after which funding for any further wells would be by equity share.

Subject to DECC approval, it is expected that part of the P218 licence will be amalgamated into P1655 and it is anticipated that the initial equities and funding obligations in the newly enlarged P1655 licence will be as follows:

Company Current
Equity %
Equity %
First Spaniards
Funding %
Second Spaniards
Funding %
EnCore Oil plc* 40.00 28.00 40.00 22.86
Nautical Petroleum 30.00 21.00 30.00 17.14
Serica Energy 30.00 21.00 30.00 17.14
Current P218
Equity %
DEO Petroleum 42.08 12.62 nil 18.03
Faroe Petroleum 28.00 8.40 nil 12.00
Maersk Oil UK 19.12 5.74 nil 8.19
Atlantic Petroleum 10.80 3.24 nil 4.63
* Operator

The first well, is expected to commence drilling in Q2 2012, subject to suitable rig availability and receipt of the necessary permitting and site survey approvals."

30 June 2011

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The technical information contained in the announcement has been reviewed and approved by Peter Sadler, Chief Operating Officer of Serica Energy plc. Peter Sadler is a qualified Petroleum Engineer (MSc Imperial College, London, 1982) and has been a member of the Society of Petroleum Engineers since 1981.

Notes to Editors

Serica Energy plc is an oil and gas exploration and production company based in London, England, and holds exploration and production licences offshore UK, Spain, Indonesia and in the Atlantic Margin basins of Ireland and Morocco. The Company's key producing and development assets are a 25% interest in the producing Kambuna field offshore Indonesia and a 50% stake in the UK Central North Sea Columbus field. Serica's gross oil and gas production amounts to approximately 2,800 barrels of oil equivalent per day.

The Company is listed on the London AIM market and the Toronto TSX market under the symbol "SQZ".

Forward Looking Statements

This disclosure contains certain forward looking statements that involve substantial known and unknown risks and uncertainties, some of which are beyond Serica Energy plc's control, including: the impact of general economic conditions where Serica Energy plc operates, industry conditions, changes in laws and regulations including the adoption of new environmental laws and regulations and changes in how they are interpreted and enforced, increased competition, the lack of availability of qualified personnel or management, fluctuations in foreign exchange or interest rates, stock market volatility and market valuations of companies with respect to announced transactions and the final valuations thereof, and obtaining required approvals of regulatory authorities. Serica Energy plc's actual results, performance or achievement could differ materially from those expressed in, or implied by, these forward looking statements and, accordingly, no assurances can be given that any of the events anticipated by the forward looking statements will transpire or occur, or if any of them do so, what benefits, including the amount of proceeds, that Serica Energy plc will derive therefrom.

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