LONDON -- Northern Petroleum (UK) and Shell Italia E&P have completed all the conditions under the agreement for the farm out of six of Northern's offshore Sicily Channel licenses to Shell.
Following notification from the Italian authorities, the licenses are now held:
GR17-NP, GR18-NP, and GR19-NP (Shell 55%, Northern 45%)
GR20-NP, GR21-NP, and GR22-NP (Shell 70%, Northern 30%)
At completion, Shell paid €1.9 million ($2.5 million) covering all of Northern's back-costs on the licenses. Shell will further pay all costs of the 4Q 2008 reprocessing and the 1Q 2009 2D seismic program. Thereafter Shell will fund all costs of two 3D seismic surveys if proposed, and the optional drilling and testing of a first well.
Northern will remain the operator during the initial seismic phase and Shell will assume operatorship for the drilling phase.
Northern Petroleum is now progressing the winter 2009 2D seismic campaign. Negotiations with the preferred contractor are close to completion following Ministry approval of the program, which will be in conjunction with a second survey over license CR147-NP in the Italian part of the Oligo-Miocene deposits that are oil producing in production in nearby Tunisian waters.