ONSHORE UNITED KINGDOM
The United Kingdom has an attractive fiscal regime. There are no royalties and corporate income tax is 30%, with an additional 20% applied to profit from oil and gas activity.
Sterling currently holds interests in three onshore U.K. basins. Two of the basins are located in southern England and the third is located in northeast England.
CLEVELAND BASIN - PEDL 068
Sterling has a 47% interest in license PEDL 068 located in the Cleveland Basin. The Kirkleatham discovery was drilled in 2006 and on production test achieved 5 MMscf/d of gas. Agreements and planning are in place to produce and sell gas to the nearby Wilton works for use in power generation and future potential gas storage. The joint venture are now working on a target for gas production to commence in October 2010.
CLEVELAND BASIN - PEDL 071
On Block PEDL 071, Sterling participated for a 20% interest in the Burton Agnes well which targeted a sizeable gas prospect. Sterling was carried through the majority of drilling costs on this well. The operator Egdon Resources concluded that the well, which came in low to prognosis, has the potential to be side tracked updip and has been left suspended. Recent mapping on the remainder of the license has identified several further prospects.