Deltic Energy PLC said on Wednesday that a rig contract has been signed with Shell UK Ltd for the drilling of the Pensacola exploration well in the North Sea.

Deltic shares were up 15% at 2.69 pence on Wednesday morning in London.

Shell UK, part of FTSE 100 oil company Shell PLC, is the operator of licence P2252 and holds a 70% working interest, with Deltic holding the remaining 30%.

Deltic said confirmation of the rig contract was a ‘significant step forward’ and a ‘key milestone’ in the preparatory work required to support the drilling of the prospect.

The drilling is scheduled to commence in the second half of September, with seabed operations for placing of the rig due to commence towards the end of July.

Pensacola will be drilled using the Maersk Resilient jack-up rig, which has been under contract to Shell since the start of June. The company said the use of the Maersk Resilient rig should bring ‘significant operational efficiencies’.

‘Pensacola is an increasingly valuable asset in the current energy environment and confirmation that the joint venture has now secured a high quality drilling rig with an experienced team for the well is another key milestone as our planning continues to progress towards the drilling of this high impact prospect,’ said Chief Executive Graham Swindells.

Deltic estimates the prospect to contain gross P50 prospective resources of 309 billion cubic feet, with a 55% geological chance of success.

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