Gas production is being ramped up by Angus Energy at its previously isolated Saltfleetby site.
The company secured first flows this month after the high prices being achieved made the infrastructure work required to bring it back online viable. When announced, the company was eyeing revenues of £7 million a month.
First discovered in 1996, extraction at the site south of Grimsby, east of Louth, began in 1999, using the nearby Theddlethorpe Gas Terminal for processing. However, the closure of that coastal operation when North Sea imports ended left it without means to reach the market.
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AIM-listed Angus bought an initial 51 per cent stake and took on operatorship in late 2019, joining Saltfleetby Energy (formerly Wingas) as a partner, prior to taking sole ownership in June. It had granted consent to reconfigure the site in March, with investment ploughed in to develop processing facilities to ensure the gas is at the right pressure, temperature and specification to be sent to the National Grid.
A pipeline extension of 750m was also required for direct connection to the transmission system.
In an update to the CIty, George Lucan, Angus Energy chief executive, said total sales of 1.2 million therms were achieved in the past 12 days, and the flow rate is to be increased to six million standard cubic feet per day this month. First gas had been achieved at the end of August, later than originally anticipated, with Shell snapping up the spoils.
A second compressor to be delivered in December, allowing it to double that rate by January.
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"Congratulations to our commissioning and operating team at Saltfleetby for a safe and successful commissioning period,” Mr Lucan said. “We now have built the foundation on which to expand our horizons in the energy space."
Flow rates have been described as “comparing favourably” to expected rates from inspections in early 2020 and late 2021.
Angus confirmed the second compressor is undergoing hydrotesting. Following mechanical completion, electrical and instrumentation work will conclude during November. “We expect delivery to site in early December," Mr Lucan said. "This second compressor is largely identical to the first and is expected to double the capacity of the plant."
The side track is expected to begin drilling operations in mid to late October, with a duration of up to 35 days anticipated. It said simultaneous operations are permitted but, the company has allowed for two 12-hour shut-in periods to undertake critical works and enable certain equipment to be moved on site, alerting investors to a pause in production.
Morning trading saw shares up 14 per cent, to 2.23p.
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