Capricorn Energy Agrees to Consolidate and Extend Western Desert Concessions in Egypt
Why we think this is neutral
The RNS announcement does not contain any of the mandatory news types, such as contract news, order news, trading update, financing, funding, annual results, asset sale/disposal, flow testing, licence news, or delisting. Therefore, the sentiment is considered neutral.
Key Points
- Consolidation of eight existing Egyptian concession agreements into a new, single integrated concession agreement
- Improved commercial terms, including a profit share of 27-29%, a merged single cost pool, 40% cost recovery over four years, and an excess cost recovery of 20%
- Improved gas price of $4.25/mmbtu for incremental gas produced from existing fields and new discoveries
- Incorporation of four additional blocks into the BED 17 development area and the direct award of two open exploration areas
- Expected increase in working interest unrisked best estimate contingent resources volume to 332 mmboe, with up to 20 mmboe expected to convert to 2P reserves post ratification
Summary
Capricorn Energy PLC has announced that it has reached an agreement with the Egyptian General Petroleum Corporation (EGPC) to consolidate eight of its existing Egyptian concession agreements into a new, single integrated concession agreement. The new concession agreement includes improved commercial terms and a refreshed primary development term to support increased investment. Key elements include a consolidated concession with an initial 10-year term plus two 5-year extensions, improved fiscal terms, and the incorporation of additional exploration blocks. The company expects the agreement to increase its working interest unrisked best estimate contingent resources volume to 332 mmboe, with up to 20 mmboe expected to convert to 2P reserves post ratification.