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EnCore Oil
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A New Generation Oil Exploration Company
EnCore Oil (LSE:EO), a UK based oil exploration and production company, whose goals are to continue to develop its North Seas holdings, has announced a significant oil discovery at its Catcher block. The discovery, rated at a potential of 300 million barrels, was announced when the firm released its statement for 2010.
Catcher, part of its central holdings, is, as the company notes, the start of its planned drilling in this area. It holds blocks to the east and west of the discovery block and they expect to find further resources when they drill test wells in 2011. Further, EnCore believes its Cladhan block explorations will yield impressive results.
Cash rich and debt free, EnCore is focusing its efforts primarily on its UK-based licenses and holdings. EnCore recently completed the transfer of its 15% interest in the Breagh gas field to RWE DEA, a part of its former North Sea portfolio, which added $68 million (US) to its coffers. That move, plus the transfer of a major portion of its holding in the Ceres gas field to Egdon, in exchange for 39 million shares, not only makes Encore the largest stakeholder in Egdon, it frees EnCore to pursue its core business. Through this exchange, Exdon takes on two major pieces of market off Frances.
The Catcher block, where EnCore is concentrating, shows extensive potential. The test well, drilled by the Transocean Galaxy II, and two side wells proved the oil was light. EnCore specialists have seen similar structures at depth in the north part of the Catcher Block.
EnCore's other promising block is the Cladhan Block and it is believee substantial reserves exist there. Test wells are planned. In addition, EnCore believes there is substantial promise in its existing inventory in the Tudor Rose Block, as well as Spaniard and Cobra.
Meanwhile, the company keeps an inventory of future sites off Western Sahara and no date has been set for exploration.
Interestingly, EnCore's business model is heavily developmental. It plans to maintain a balanced portfolio of holdings and will develop parcels that will produce real value and not just add to inventory.
EnCore ended the year free of debt and with capitalization of more than 46 million pounds.
As of the close of business, the business year had a $19 million pound surplus, cash on hand of $41.9 million pounds, the company was awaiting $23 million, and an expected $23 million pound gain on when the sale of Breagh Gas is finalized.
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