Trapoil confirmed it would relinquish its North Sea “Orchid” license after failing to secure a potential farm-out.
The firm’s board decided to cut its losses after licence P.1556 Block 29/1c became too expensive to maintain.
In January 2013, the independent oil and gas North Sea explorer agreed a £1.5million deal to takeover a majority stake in the Orchid discovery.
According to the firm, the impairment charge associated with the relinquishment of Orchid is expected to amount to £5.8million.
This charge is not expected to affect Trapoil’s net unrestricted cash reserves, which currently stands at approximately £7million.
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