Business
BNG Contract Area Early Licence Renewal
BNG Contract Area Early Licence Renewal.
About this update from Caspian Sunrise Plc
[{"type":"text","content":"\n \nRNS Number : 7739U Caspian Sunrise plc 27 October 2017 \n\nCaspian Sunrise PLC (\"Caspian Sunrise\" or the \"Company\")\n \nBNG Contract Area Early Licence Renewal\n \nIntroduction\n \nCaspian Sunrise PLC (AIM:CASP) (\"Caspian Sunrise\"), the Central Asian oil and gas company, with a focus on Kazakhstan, is pleased to update the market with news of the extension of its licence at its flagship BNG Contract Area.\n \nBNG licence renewal\n \nCaspian Sunrise has a 99% interest in the BNG Contract Area, which is located in the west of Kazakhstan, 40 kilometers southeast of Tengiz, on the edge of the Mangistau Oblast.\n \nAs previously announced the licence at the BNG Contract Area is due for renewal in June 2018, when it was expected the Company would apply for a 29-year full production licence to cover the whole BNG Contract Area.\n \nThe principal benefit from moving to a full production licence will be the ability to sell the majority of oil produced based on world prices rather than the domestic prices permitted under an appraisal licence (currently typically $16-$20 per barrel). \n \nA drawback is that a condition of such a licence upgrade may have been the need to curtail some of the planned exploration and development activities especially at our deeper prospects. This stems predominantly from the need to have explored regions and structures during the appraisal period of a licence to allow unrestricted further development during the full production phase.\n \nCaspian Sunrise is therefore delighted to announce its early agreement with the Kazakh regulatory authorities to extend the whole of its licence at BNG on an appraisal basis for a further six years effective from June 2018 with the opportunity from that date to apply to convert individual structures to full production status at the Company's timing.\n \nThe ability to elect the timing of when to apply for different structures to move to full production status will allow the Company to manage the move from appraisal to production on a structure by structure basis rather than for the Contract Area as a whole.\n \nThis marks a very positive outcome as it should be possible for instance for the Company to operate its highly successful and well developed MJF structure on a full production licence basis while co...