10 Jun 2015 07:00
Northern Petroleum Plc
("Northern Petroleum" or "the Company")
Italian environmental impact assessment approvals
Northern Petroleum, the AIM quoted oil company focusing on production led growth, announces that its environmental impact assessment ("EIA") for the acquisition of 3D seismic data across the Giove undeveloped oil discovery and the Cygnus exploration prospect in the southern Adriatic has been approved by the Italian regulatory authorities. In addition, EIAs for two of the Company's exploration permit applications, contiguous to the two existing permits in the southern Adriatic, have been approved.
Summary
§ EIA approval for the acquisition of 3D seismic within the 100 per cent owned permits, F.R39.NP and F.R40.NP
§ F.R40.NP contains the Giove oil discovery with 2C contingent resources of 26 million barrels of oil ("mmbbls")
§ F.R39.NP contains the Cygnus exploration prospect with mean unrisked prospective resources of 446 mmbbls
§ EIA approval for two further exploration applications, contiguous to the F.R39.NP and F.R40.NP permits
§ The Company will seek a farm in partner prior to acquiring the 3D seismic
Keith Bush, Chief Executive Officer, commented:
"The Company has been working with the appropriate authorities in Italy to progress its permits and applications, and has refrained from discussing the opportunities until tangible progress has been made. This has now happened, both with the approval of these EIAs and also the recent farm out of the Cascina Alberto permit to Shell. The Italian portfolio continues to be a core area for Northern and the possibility of value being realised over the short and medium term from these assets has significantly improved."
3D seismic approval
Northern Petroleum's EIA to acquire 3D seismic within the 100 per cent owned F.R39.NP and F.R40.NP permits in the southern Adriatic has been approved by the Ministries of the Environment and National Heritage. This is the key approval required to allow the Company to continue its exploration and appraisal campaign in the southern Adriatic.
The Company's southern Adriatic permits and applications, including F.R39.NP and F.R40.NP, lie within a proven hydrocarbon province containing a number of oil and gas discoveries and the producing Aquila oil field ("Aquila"). The area has significant exploration and appraisal potential.
The F.R40.NP permit contains the Giove oil discovery, drilled in 1998 by Enterprise Oil plc. The Giove discovery identified a 94 metre gross oil column in Oligocene reef carbonates. The discovery is located in 600 metres of water, 20 km from the Italian coast and 12 km from Aquila. A subsurface evaluation completed by ERC Equipoise Limited ("ERCE") in 2014 determined an expected 2C recoverable resource of 26 mmbbls, based on stock tank oil originally in place of 140 mmbbls.
The F.R39.NP permit, adjacent to F.R40.NP, contains the Cygnus prospect which is up-dip of Aquila. Data from the Aquila development wells and existing 2D seismic data indicates that Cygnus may share an oil water contact with Aquila. During 2013 ERCE evaluated the Cygnus prospect and in the high case, which recognises a common oil water contact, assigned a prospective resource of 978 mmbbls, with 790 mmbbls of recoverable oil within the F.R39.NP permit.
The ERCE prospective resources estimate for the mean case using a shallower oil water contact, which assumes separation of Aquila from the mapped prospect, is 446 mmbbls, of which 401 mmbbls lie within the permit. The Cygnus prospect is considered to have a stratigraphic trapping mechanism, with its reservoir comprising resedimented carbonates derived from the adjacent Apulian platform. The distal and basin equivalent of these sequences are productive in Aquila. ERCE estimate a chance of success of 12 per cent for the Cygnus prospect.
The acquisition of 3D seismic data over both the Giove discovery and the Cygnus prospect will help delineate Cygnus and will be used to more clearly define the optimum locations for the Giove appraisal well and the Cygnus exploration well. The Company will seek a farm in partner prior to acquiring the 3D seismic.
Application EIA approvals
Northern Petroleum has received approval of the EIAs in respect of applications d61F.R-NP and d66F.R-NP from the Ministries of the Environment and National Heritage, which will form permits contiguous with the Company's existing permits in the southern Adriatic. The final requirement for these applications to become exploration permits is decree by the Ministry of Economic Development. The Company has three further application EIAs in the area, the approvals of which are expected to follow shortly.
Recent licencing rounds in Montenegro and Croatia have demonstrated a renewed interest from the industry in the Adriatic. The Company's existing permits and the application areas open up a substantial (4,500 sq km) position for exploration and appraisal, in an area that contains multiple oil and gas discoveries. A number of proven plays exist, including resedimented carbonates along the platform margin, as per the Cygnus prospect and the Aquila oil field, and deep Mesozoic carbonate structures, where Triassic aged source rocks are mature for oil generation. Tertiary gas leads have also been identified through seismic amplitude anomalies. The gas potential in the area is proven by the nearby Falco gas discovery.
The first stage of the exploration programme, once the permitting process is complete, will be the acquisition of 2D seismic across the permits in order to high grade the prospectivity of these blocks ahead of a farm out campaign.
-Ends-
For further information please contact:
Northern Petroleum Plc Tel: +44 (0)20 7469 2900
Keith Bush, Chief Executive Officer
Nick Morgan, Finance Director
Westhouse Securities Limited (Nomad and Joint Broker) Tel: +44 (0)20 7601 6100
Alastair Stratton
Robert Finlay
FirstEnergy Capital LLP (Joint Broker) Tel: +44 (0)20 7448 0200
Jonathan Wright
In Accordance with AIM Rules - Guidance for Mining and Oil & Gas Companies, the information contained in this announcement has been reviewed and signed off by the CEO of Northern Petroleum, Mr Keith Bush, who has 23 years' experience as a petroleum engineer. He has read and approved the technical disclosure in this regulatory announcement. The technical disclosure in this announcement complies with the SPE/WPC standard.
Note to Editors:
Northern Petroleum is an oil and gas company focused on production led growth. The Company is undertaking a redevelopment and production project in north west Alberta and has a broader portfolio of exploration and appraisal opportunities in countries of relatively low political risk, primarily Italy. Comprehensive information on Northern Petroleum and its oil and gas operations, including press releases, annual reports and interim reports are available from Northern Petroleum's website: www.northernpetroleum.com