7th Feb 2019 10:28
LONDON (Alliance News) - United Oil & Gas PLC and Prospex Oil & Gas PLC on Thursday said a maiden reserve estimate for an Italian gas field is a milestone for both firms.
A competent persons' report was prepared by CGG Services UK Ltd for the Selva gas field, onshore Italy, in the Po valley region.
The report gives gross proven and probable reserves of 13.3 billion cubic feet of gas.
Prospex has a 17% stake in Selva, meaning its own interest is worth 2.26 billion cubic feet. With UOG owning 20%, it can lay claim to 2.7 billion cubic feet.
As well as Selva, the two UK-listed firms said, there are further areas of potential prospectivity next to Selva, and the partners plan to acquire data for these areas to allow future drilling plans to be made.
The two hope to have production from Selva by 2020, having had a production concession granted recently on a preliminary basis.
"2.7 billion cubic feet of proven and probable reserves of gas attributable to our 20% interest in the Selva gas field is a key milestone for the company," said UOG Chief Executive Brian Larkin.
"Not only do these represent United's first reserves, they serve to demonstrate the considerable progress that has been made by the partners in de-risking the field and advancing it towards production," he added.
"With preliminary approval for the development plan received in January, we remain on course to bring Selva into production in 2020 with facilities designed to produce at a gross rate of up to 150,000 cubic metres per day."
Prospex Non-Executive Chair Bill Smith added: "Our 2.26 billion cubic feet share of the Selva gas field's reserves represents another first for Prospex. While bringing the Bainet gas field in Romania online generated our first production and revenues in 2018, Selva is the first time that valuable reserves have been assigned to one of our projects by an independent third party.
"Not only is this a major milestone for the company, it provides Prospex with significant asset backing, particularly when compared to our current market valuation of approximately GBP3.3 million."
Prospex shares were 11% higher Thursday at 0.30 pence each, while UOG's were 1.4% lower at 4.83p.
Related Shares:
United Oil&gasPXOG.L