North-east oil firm Xcite Energy, which is focused on the UK North Sea, said yesterday it had a seminal first quarter of the year and was now poised to show the commercial value of the Bentley field.
The heavy-oil asset – more difficult to produce because of its thick, sticky consistency – is in Block 9/3b in the UK North Sea, about 100 miles east of Shetland.
Xcite Energy Resources (XER), a wholly owned subsidiary of the Banchory-based group, was awarded a 100% working interest in the block in 2003 as part of the 21st UK offshore licensing round.
In January 2008, XER drilled and tested a well in the central area of Bentley, one of the largest proven but undeveloped fields in UK waters with an estimated £1billion-plus development cost.
Earlier this year, Xcite raised equity funding of about £23.1million net of expenses to cover the drilling of a pre-development well (9/3b-R) and working-capital purposes.
It has also secured a farm-in partner, US-owned exploration and production company Challenger Minerals (North Sea), which is providing about £2.8million towards the cost of the new well in return for a 4% stake in the field.
XER has recently secured a jack-up rig, subject to contract and appointed engineering and project-management company AMEC to do consultancy work to help it develop the field.
In March, Xcite said that after reprocessing 3D seismic data it estimated most likely recovery from Bentley at 160million barrels.
The field was previously assessed as having recoverable reserves of 80-166million barrels.
Announcing results yesterday, Xcite, which has no production so far, reported net losses of £265,000 for the first three months of 2010.
The Alternative Investment Market-listed company has its registered office in the British Virgin Islands.