By Adria Calatayud

 

Shares in Egdon Resources PLC (EDR.LN) rose Tuesday after the company said it has signed a farm-in agreement with Royal Dutch Shell PLC's (RDSB.LN) British subsidiary for two U.K. offshore licenses.

The U.K. oil-and-gas company said Shell will acquire a 70% working interest in licenses P1929 and P2304--which respectively host the Resolution and Endeavour gas discoveries--and be appointed as operator of the assets, while Egdon will retain a 30% interest.

Shares in Egdon at 1313 GMT were up 19% at 6.25 pence.

Shell will pay 85% of costs of the acquisition and processing of a 3D seismic survey covering both the Resolution and Endeavour gas discoveries up to a maximum amount of $5 million, Egdon said. If the costs exceed $5 million, Shell will cover 70% of the costs, Egdon said.

Shell will also pay all studies and manpower costs up to a well-investment decision on the licenses, Egdon said.

In December, Egdon said it had been granted an extension to the licenses to May 31 subject to securing a farm-in agreement by Jan. 31.

 

Write to Adria Calatayud at adria.calatayud@dowjones.com

 

(END) Dow Jones Newswires

January 21, 2020 08:37 ET (13:37 GMT)

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