VELO Energy said yesterday it had received clarification from the Department of Energy and Climate Change on transfers of non-operated licence interests in the UK North Sea to the company.
The Canadian oil and gas explorer said there had been a substantial change from the January 5 letter from the DECC in which the ministry had refused consent to any licence transfers.
Velo said it had been approached by recognised UK operators with respect to farm-in and joint-venture opportunities and was engaged in discussions with these parties. It added that it had also received a notice of termination of the agreement under which it had arranged to buy stakes in the Caledonia, Sheryl and Catcher areas in the UK North Sea.
That agreement had been conditional upon Velo completing its financing on or before January 31, and other conditions including DECC consent to the transfer of interests.
Velo said that the vendor – Premier Oil – also formally advised that it was prepared to enter into another deal for the acquisition of interests in the Caledonia and Sheryl (but not Catcher) areas on the same terms.
A DECC spokeswoman said: “Following discussions with Velo we have indicated we would consider an arrangement where Velo became a non-operating licen-see, provided an experienced operating licensee in good standing was already on, or came on to, a licence at the same time as Velo.”
Velo Energy chief executive Arthur Millholland, who held the same role at the failed Oilexco North Sea, had been told earlier by the DECC that his new company could not enter the North Sea because of substantial similarities between management and control of Velo and Oilexco.
Premier Oil bought Oilexco North Sea out of administration in a £345million acquisition last year.