Cluff chief executive and chairman Algy Cluff hit out at the “alarming rate” at which the UK has started to import gas to meet its needs.
“There is so much focus now in the UK on heavily subsidised renewables that the North Sea seems to have receded in significance and yet, there remains in the North Sea, not only massive infrastructure, but also the potential for discoveries of new reserves of oil and particularly of gas, of which the UK is badly in need,” he said.
“10 years ago, the UK was self-sufficient in gas, whereas now we import over 50% of our requirement from, inter alia, Norway, Qatar, Algeria, Russia and Peru! This figure is increasing at an alarming rate and security, as well as commerciality, must dictate that the North Sea is an absolute priority for exploration.”
The company leader outlined his three-pronged approach for the months ahead in his latest company update.
“Our mission is three-pronged: to farm-out our existing licences and achieve drilling; to invest in additional assets; and to add to our portfolio via participation in the 30th Round,” he said.
He described out the 30th round was “frustratingly delayed by the recent General Election”; however, it emphasized its importance to unlocking trapped potential in the basin.
“The 30th Licencing Round, announced on 25 July 2017, represents an exhilarating challenge,” he said.
“Over 800 blocks have been made available for application by the UK’s Oil & Gas Authority, which includes a large inventory of prospects and undeveloped discoveries. The Round closes on 21 November 2017 and awards are expected to be made in Q2 2018. The 30th Round provides us with the opportunity to further expand our portfolio of North Sea licences and to take advantage of the more flexible “Innovate” licence regime. We have already identified our target blocks and our technical work to support our applications is well underway.
“Meanwhile, in addition to our intention to participate in the 30th Round, we are committed to further diversifying our portfolio with an investment in one or more oil and gas assets. We have been actively pursuing a number of opportunities, including both onshore and offshore production and appraisal assets which offer cash flow and, in the case of appraisal, significant value enhancement, as and when commerciality is demonstrated. It is my objective that we shall complete one or more of these deals in the short to medium term.”
The firm has a current cash position of £893,000. It made a loss for the first half of the year of £774,288.
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