Dart Says Centrica Deal May Spur Shale Partner TalksJames Paton
Dart Energy Ltd., an explorer with shale gas prospects in northwest England, said Centrica Plc’s deal last week to acquire a 25 percent stake in a license in the region may help accelerate its talks to find a partner.
Dart’s acreage in the U.K.’s Bowland Basin has attracted “a lot of interest,” John McGoldrick, chief executive officer of the Singapore-based company, said yesterday in a phone interview. Centrica, the largest U.K. energy supplier, bought part of Cuadrilla Resources Ltd.’s Bowland shale license for 40 million pounds ($63 million) and will pay exploration costs of as much as 60 million pounds, the company said June 13.
Dart, whose shares have surged 35 percent in Sydney trading since the Centrica transaction, said earlier this year that it would look for a partner to develop the Bowland acreage. Centrica’s deal may help spark investment in the nascent U.K. shale industry after exploration was held up because drilling by Cuadrilla caused two earth tremors in 2011.
“The Centrica deal has injected some urgency into the situation, because a lot of these companies don’t react that quickly,” McGoldrick said. “If you want to play, all of a sudden the playground appears to be getting smaller.”
Cuadrilla has said its Bowland acreage in the northwest of England may hold as much as 200 trillion cubic feet of gas, more than Iraq’s reserves, although only a portion of that would ever be recoverable. Dart says its Bowland shale acreage may hold as much as 110 trillion cubic feet of gas, while IGas Energy Plc also holds gas resources in the Bowland.
“I’m pushing very hard to get something put together shortly” on a partnership, McGoldrick said. “We’re pushing ahead, and maybe this deal will help accelerate things.”
Total SA and Royal Dutch Shell Plc are considering investing in U.K. shale drilling, both companies have said.
Dart is focusing on shale and coal bed methane in the U.K. amid stricter regulation of the industry in Australia. The company earlier this year scrapped an initial public offering of its international assets and cut staff by 70 percent.
Dart shares, as high as A$1.318 in October 2010, dropped 11 percent today to 7.3 cents in Sydney.