Orcadian (AIM: ORCA) has agreed a a seven day extension with a potential operator on its P2244 licence in the Pilot field.
The extension starts on 30 November 2023 and ends on 7 December.
In addition to this, the firm has submitted a couple of requests to the UK regulator, the North Sea Transition Authority (NSTA), relating to the project.
Namely, Orcadian has asked for approval of the appointment of the potential operator under, and in accordance with, clause 24 of the P2244 Licence.
The firm has attached to this application a currently agreed sale and purchase agreement (SPA).
This has been sent to the regulator on the understanding that a fully executed SPA will be filed before 7 December 2023.
Orcadian writes: “There can be no guarantee that the SPA with a potential operator will be signed by the New Deadline but the Directors have every confidence that it will be.”
License extension for Pilot
In October Orcadian Energy announced that the NSTA was prepared to grant a two-year extension on its P2244 licence in the Pilot field, subject to certain conditions.
The extension would change the expiry date of the Second Term of P2244 from November 30, 2023 to November 30, 2025.
Orcadian announced on September 18 this year it had entered into a non-binding heads of agreement with an unnamed North Sea operator on a potential farm-in to its £1bn Pilot project.
Under the agreement, the new firm would take control of the Pilot project- a 97 million-barrel project in the Central North Sea – with an 81.25% stake.
The company would pay 100% of the pre-first oil scope, with Orcadian then paying its working interest share of expenditure (18.75%).
It comes after Orcadian previously estimated the cost to first oil being around £1bn, with some scope for reductions.
On completion of the deal, extension over P2244 and award of licence P2320, Orcadian would receive cash of up to $200,000 from the operator, with a further $3m upon Pilot FDP approval.