Upland Resources has terminated its conditional farm-in agreement for 10% of the Wressle Development project.
This follows the Planning Inspectorate's recent decision to reject the appeals by Egdon Resources, as operator, against two of the three planning refusals by North Lincolnshire County Council's Planning Committee in respect of the development of the Wressle oil discovery in licences PEDL 180 and PEDL 182.
Upland's wholly-owned subsidiary, Upland Resources (UK Onshore) Limited, entered into a conditional agreement dated 24 November 2016 for the farm-in by Upland UK (by way of assignment from Europa Oil & Gas Limited) to a 10% interest in each of PEDLs 180 and 182, including the Wressle Field development.
Upland UK and Europa had agreed to extend the long-stop date for satisfaction of the conditions to completion of the Wressle Farm-in Agreement to 28 February 2018.
One of the outstanding conditions to completion was the award of relevant planning permissions to the Wressle development, but that if this condition was not satisfied before that date, Upland UK would be under no obligation to complete the Wressle Farm-in Agreement or make payment for the 10% interests in PEDLs 180 and 182.
In the event of rejection of any of the planning appeals, Upland UK had the right to terminate the Wressle Farm-in Agreement at any time following the result of the appeals being known, without having to wait until 28 February 2018.
Upland said it is clear that the new planning application and the application for extension of the current planning consent to the North Lincolnshire Council will not result in the award of the planning permissions before the long-stop date of 28 February 2018.
Upland UK has therefore given written notice to Europa to terminate the Wressle farm-in agreement with effect from 25 January 2018. The £160,000 deposit is due to be returned to Upland UK by Europa by this date and Upland UK will have no further financial obligations.
Steve Staley, CEO of Upland Resources Limited, said: "Whilst we are obviously disappointed that we will not be continuing with the Wressle opportunity, we have no shortage of good assets to pursue and develop, as recently highlighted through our farm-in to the highly prospective Wick prospect in the UK North Sea, and will be updating investors in due course as to the other active discussions we are currently in."
At 9:41am: (LON:UPL) Upland Resources Limited share price was -0.03p at 1.26p