REG - EnergyPathways PLC - Company Update

EnergypathwaysAnnouncement

16/05/2024 07:00

For best results when printing this announcement, please click on link below:
http://newsfile.refinitiv.com/getnewsfile/v1/story?guid=urn:newsml:reuters.com:20240516:nRSP6935Oa&default-theme=true

RNS Number : 6935O  EnergyPathways PLC  16 May 2024

16 May 2024

 

EnergyPathways plc

 

("EnergyPathways" or the "Company")

 

Company Update

 

EnergyPathways plc (AIM: EPP), an integrated energy transition company, is
pleased to provide the following update on its plans to deliver clean,
home-grown energy for the UK.

 

Key Highlights

 

·    EnergyPathways continues to make solid progress on the planned
development of its flagship Marram energy storage project ("Marram" or the
"Marram Project"), a fully appraised 'Ready to go' low-cost development that
can provide critical gas supply and storage infrastructure for the UK,
targeting first gas in 2025

 

·    Ongoing engineering and design work confirms the feasibility of
EnergyPathways' plan to develop the Marram Project for future gas storage use
and to integrate it into a wider UK Irish Sea energy storage project,
incorporating other geo-storage reservoirs, storage infrastructure and
hydrogen production to support the UK energy market's future needs

 

·   "Out of Round" requests for gas production and gas storage licences
are progressing with the North Sea Transition Authority ("NSTA"), the UK's oil
and gas, offshore hydrogen, and gas and carbon storage industries regulator

 

·  The Company was outbid for the Castletown discovery block application
made in the 33rd licensing round

 

·    Discussions are progressing with a major regional wind company for
the supply of renewable wind power to the planned Marram Project and an
expanded UK Irish Sea energy storage project

 

·    Engineering studies have substantially confirmed the potential to
fully electrify EnergyPathways' Marram Project and a UK Irish Sea energy
storage project

 

·    Discussions are progressing well on both debt and equity financing

 

Marram Update

 

The Company continues to make solid progress on the planned development of its
flagship Marram Project in the UK Irish Sea that contains up to 35.3 Bcf of
undeveloped gas 2P Reserves and 11 Bcf of 2C Contingent Resources in
high-quality reservoirs and shallow water, and its subsea tieback development
opportunity in close proximity to existing gas and electricity infrastructure
(circa 15-25km) that has available capacity. The development is expected to
comprise two shallow short lateral production wells and targeting first gas as
early as 2025.

 

Ongoing engineering and design work have confirmed the feasibility of
EnergyPathways' plan to develop Marram for future gas storage use and into a
UK Irish Sea energy storage project involving potential other geo-storage
reservoirs, storage infrastructure and hydrogen production to support the UK
energy market's future needs.

 

The first phase of this wider energy storage project concept is the
development of the Marram gas field, initially for gas production before it is
transitioned for gas storage use and hydrogen operations. EnergyPathways has
requested a licence extension to the Marram block area so there is more than
adequate time to update its Field Development Plan for its decarbonisation and
storage initiatives.

 

Once the Marram Gas field is in operation, it will initially increase domestic
gas supply before transitioning to storage operations and hydrogen production
which is expected to enhance UK energy market security and efficiency while
supporting the UK's transition to renewable energy.

 

In parallel to progressing Front End Engineering Design (FEED) works on the
proposed Marram Gas field development, negotiations are progressing on an
offer to purchase all gas produced from the Marram Field and the Board of
EnergyPathways are optimistic of seeking expressions of interest in relation
to foundation storage contracts.

 

Engineering studies with leading technical contractors continue to support a
fully-electrified-development approach for Marram's proposed initial gas
development and future storage. EnergyPathways is working to establish an
alliance with leading engineering contractors to design the electrification of
wellhead control systems which will be connected to dedicated renewable power
sources and battery storage solutions. The assessment is also considering
electrically powered gas compression solutions for Marram gas production and
future gas storage use.

 

On available funding sources for the proposed Marram Project development,
EnergyPathways is engaged in ongoing discussions and confidential negotiations
regarding debt financing options for Marram and the acquisition of regional
energy infrastructure assets. In parallel, the Company has received
expressions of partnership interest from energy sector companies providing
additional optionality for development financing.  These discussions are
early stage, however, management are encouraged by the level of interest it
has received from the various funding sources and is actively pursuing all
possible alternatives.

 

UK Irish Sea Licence Applications

 

As previously announced, EnergyPathways has submitted "Out of Round" licence
requests to the NSTA regulator for licences EnergyPathways' plans to
incorporate into its UK Irish Sea Energy Storage Project. The "Out of Round"
licences requests include; gas production licences for the "ready for
development" Knox and Lowry fields, and gas storage licences for the Marram,
Knox and Lowry fields. Following the completion of the 33(rd) Licensing Round,
we anticipate that the NSTA will start evaluating these "Out of Round" licence
requests.

 

The Company also submitted a 33(rd) Licencing round application for the
Castletown discovery block in the UK Irish Sea. While EnergyPathways' bid was
unsuccessful, feedback from the NSTA indicates that the Company submitted a
strong technical and financial bid.

 

Commenting on the update, CEO Ben Clube said:

 

"This continues to be a very active period for EnergyPathways as we progress,
as a priority, the development of the Marram energy storage project to provide
critical gas supply and storage infrastructure for the UK. Good progress has
also been made in developing our vision of an expanded UK Irish Sea energy
storage project, and with the conclusion of the UK 33(rd) Licensing Round, it
is expected the NSTA will shortly start the evaluation of "Out of Round"
licence requests including our gas production and gas storage licence
requests.  Like Marram, the Knox and Lowry licence requests are also "ready
for development" meaning they will not require appraisal drilling and would
therefore likely require significantly lower levels of pre-development
investment than Castletown would have required.  The engineering studies for
the initial development of Marram gas and energy storage project and the wider
energy storage project concept are progressing well and we are encouraged by
the nature of the ongoing discussions with all relevant stakeholders as we
seek to bring the Marram Project into production and then give life to the
energy storage project concept that we believe will support all the key
elements of UK energy policy."

 

The Directors of the Company are responsible for the release of this
announcement.

 

This announcement contains inside information for the purposes of Article 7 of
EU Regulation 596/2014 (which forms part of domestic UK law pursuant to the
European Union (Withdrawal) Act 2018).

 

 

Enquiries:

 

 EnergyPathways                                        Tel: +44 (0)20 7466 5000, c/o Buchanan (Financial PR)

Ben Clube / Ben Hodges

                                                     Email : info@energypathways.uk

 Cairn Financial Advisers LLP (Nominated Adviser)      Tel: +44 (0)20 7213 0880
 Jo Turner / Louise O'Driscoll / Sandy Jamieson
 SP Angel Corporate Finance LLP (Joint Broker)         Tel: +44 (0)20 3470 0470
 Richard Hail / Adam Cowl
 Optiva Securities Limited (Joint Broker)              Tel: +44 (0)20 3137 1903
 Christian Dennis / Daniel Ingram
 Global Investment Strategy UK Limited (Joint Broker)  Tel: +44 (0)20 7048 9000
 Callum Hill / James Sheehan

 

For further information on EnergyPathways visit www.energypathways.uk and
@energy_pathways on X (formerly Twitter).

 

Forward Looking Statements

This announcement contains forward-looking statements relating to expected or
anticipated future events and anticipated results that are forward-looking in
nature and, as a result, are subject to certain risks and uncertainties, such
as general economic, market and business conditions, competition for qualified
staff, the regulatory process and actions, technical issues, new legislation,
uncertainties resulting from potential delays or changes in plans,
uncertainties resulting from working in a new political jurisdiction,
uncertainties regarding the results of exploration, uncertainties regarding
the timing and granting of prospecting rights, uncertainties regarding the
timing and granting of regulatory and other third party consents and
approvals, uncertainties regarding the Company's or any third party's ability
to execute and implement future plans, and the occurrence of unexpected
events.

 

Actual results achieved may vary from the information provided herein as a
result of numerous known and unknown risks and uncertainties and other
factors.

This information is provided by RNS, the news service of the London Stock Exchange. RNS is approved by the Financial Conduct Authority to act as a Primary Information Provider in the United Kingdom. Terms and conditions relating to the use and distribution of this information may apply. For further information, please contact
rns@lseg.com (mailto:rns@lseg.com)
 or visit
www.rns.com (http://www.rns.com/)
.

RNS may use your IP address to confirm compliance with the terms and conditions, to analyse how you engage with the information contained in this communication, and to share such analysis on an anonymised basis with others as part of our commercial services. For further information about how RNS and the London Stock Exchange use the personal data you provide us, please see our
Privacy Policy (https://www.lseg.com/privacy-and-cookie-policy)
.   END  UPDSFDSIMELSEDI