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Future Plans
Strategy
Granby's strategy is to pursue exploration and development opportunities in the North Sea and in carefully selected areas overseas. This strategy is unchanged, though the company have adapted and adjusted quickly to the industry's changing environment by moving into onshore exploration, by applying for and winning licences in the gas prone area in the Southern North Sea, and by taking the first steps towards developing a new business area in North Africa. Granby's aim in making these moves was to have the flexibility to take advantage of different rig markets to help keep costs down and maintain exploration activity, as well enabling the company to access opportunities overseas where they see less competition for assets and more technical upside than is usual in the North Sea.
Future Drilling Programme
Successful exploration requires quality prospects, sound technical and commercial ability, funding and the opportunity to drill a number of wells. In the current environment of high oil prices it is becoming increasingly difficult to source rigs and drilling opportunities. However, Granby are involved in three fully funded wells which are due to be drilled by 31 March 2007 and for which farminees will be paying 100% of Granby's share of the costs.
The next well in Granby's drilling programme is expected to target the company's Guinea prospect in block 15/13b. It will be operated by Nexen, which has already conducted the site survey and has the rig Borgsten Dolphin under contract, with drilling operations planned to begin in October.
Participation in Granby's first onshore well is also expected around the end of 2006, although the timing is subject to approval of a planning application. This well will be drilled on the Fraisthorpe gas prospect in Yorkshire and will be operated by Egdon Resources. Granby's co-farminees, two subsidiaries of Gas Plus Italiana, will contribute Granby's share of the well costs, whilst Granby will contribute technical work to the venture.
Centrica will operate what is expected to be Granby's third well of the current year on the Watling gas prospect in block 42/28c, the company's first in the Southern North Sea. It is hoped that a suitable rig slot will be available over the winter period. The target reservoir is the highly productive Rotliegendes sandstone.
24th UK Licensing Round
The 24th UK Offshore Licensing Round was announced by the UK Department of Trade and Industry on 16 March 2006. Granby submitted several applications on 15 June 2006, in conjunction with a number of partners. Granby's approach has changed to reflect the more competitive environment, with fewer quality blocks available chased by an increasing number of exploration companies. Consequently, Granby have agreed an alliance with Gas Plus Italiana for this licensing round which enabled the company to make stronger bids with more significant work programmes whilst limiting exposure to application costs.