Rex subsidiary to acquire 4 mmboe of net contingent resources in Brasse Field, Norway

The Brasse Field is expected to start commercial production in 2027.

Rex International’s 91.65% subsidiary, Lime Petroleum, has entered into sale and purchase agreements (SPAs) with DNO Norge AS (DNO) and OKEA ASA (OKEA) to acquire 10.72% and 6.28% stakes in production licence (PL) 740 in the Norwegian North Sea, where the Brasse Field is at. OKEA and DNO currently hold a respective 45.6% and 50% in the licence while M Vest Energy AS holds the remaining 4.4% stake in the licence.

The final investment decision for the Brasse Field, which is located in shallow water on the Norwegian continental shelf just south of the Brage Field, is expected to take place in the 1Q2024. The Brasse Field is expected to start commercial production in 2027.

In its report on the environmental impact study for the field dated Oct 20, OKEA, the operator, says it expects recoverable resources in Brasse to be 21 to 29 million barrels of oil equivalent (mmboe) or 3.39 million cubic metres to 4.58 million cubic metres.

According to Rex, the farm-in of Lime’s 17% stake in the license will result in some 4 mmboe of contingent resources net to Lime. The farm-in is conditional on customary governmental approvals, which Lime expects to be completed by the end of 2023 or early 2024.

“The farm-in is a further extension of Lime’s strategy to build value in the company by adding reserves and production, following our acquisitions of interests in the producing Brage and Yme fields in 2021 and 2022 respectively,” says Lars Hübert, Lime’s CEO.

“Through our participation in the Brage Field, we know the area very well. The Brasse Field development will have significant positive synergies with Brage, likely allowing the extension of Brage Field’s lifespan, adding to our cash-flow stream in the long-term. We look forward to working closely with the Operator, OKEA, and the other partners in the field in the months and years to come,” he adds.

As at 11am, shares in Rex are trading 0.2 cents lower or 1.16% down at 17.1 cents.

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