| ||June 15, 2012|
Po Valley executes a Farmout on 2 Licences in the Po Valley
| ||Po Valley Energy Limited (ASX:PVE) is pleased to announce that a farmin agreement has been executed with Petrorep Italiana S.p.a. (PETROREP) for the Cadelbosco di Sopra exploration licence as well as an option agreement in respect of the La Prospera exploration licence -- both licences are located in the Po Valley in northern Italy.|
The agreement permits PETROREP to earn a 15% interest in the up-coming work programme for the Cadelbosco di Sopra permit which includes drilling three exploration wells - Zini 1, Canolo 1D and Canolo 2D, for which the drilling approval process is in progress.
The agreement also permits PETROREP to earn a 15% interest in the La Prospera licence, which includes one exploration well -- Gradizza 1 which is in the final stage of the drilling approval process. The participation of PETROREP in the exploration activity for the La Prospera licence is subject to the fulfilment of certain conditions precedent.
For its 15% interest, PETROREP will commit to a promoted share of future drilling expenditures and reimbursement on past costs. PVE will retain the residual interest and retain operatorship. The farmout agreement for both licences is subject to regulatory approvals by the Italian Ministry of Economic Development (Ministero dello Sviluppo Economico).
Po Valley CEO, Mr Giovanni Catalano commented: "The commencement of a joint venture partnership represents an important initiative for PVE. We welcome the partnership with PETROREP which has a long and successful track record in Italy. Active in Italy since 1968, PETROREP's strategy is to participate in ventures through a minority interest and it has consistently proven to be an asset to its partners from both a financial and technical standpoint."
"The farmin into these two licences by an experienced partner is an important first step in our stated development strategy which aims to accelerate the short term work programme by drilling low risk assets with farmin partners; allowing us to accelerate the movement of Contingent Resources into the Proven category. We continue to progress discussion with other potential farmin partners in relation to other 100% owned assets in our exploration portfolio. While the terms of this farmin agreement are commercial-in-confidence, they are favourable by Italian market standards and confirm the commercial attractiveness of our development portfolio." Po Valley CEO, Mr Giovanni Catalano, said.
Background on PETROREP
Established in 1968, Petrorep Italiana S.p.a. is a subsidiary of Petrorep S.A. of Paris, which is controlled by the French Independent group Petrofrance. Since its inception, PETROREP has entered into several joint ventures with the major Italian Oil Companies to explore and produce hydrocarbons; it produces gas via 12 exploitation concessions and holds a number of explorations licences. Petrorep S.A., established in 1956, is the leading oil Exploration and Production Company of the Petrofrance Group; still active in France, it was the first Company to discover oil in the Paris basin.
Background on CADELBOSCO DI SOPRA Permit
Cadelbosco di Sopra exploration permit was awarded to the Company in February 2011.
A preliminary exploration assessment of the former ENI Correggio gas field (which produced 7.1 BScm / 253 bcf from 41 productive wells) in 2009 confirmed the presence of remaining gas potential in this area.
During 2011 the company processed 111km of 2D seismic (purchased from ENI) and together with a dynamic study and history match analysis, assessed the remaining Quaternary and Pliocene potential.
Two Quaternary prospects, Canolo-1D and Zini-1 (2C: 32 MScm and 87 MScm, respectively, 1.1bcf and 3.1 bcf), and one Pliocene prospect named Canolo-2D (2C:102 MScm, 3.6bcf) have been identified and drilling applications were filed with the Ministry of Economic Development. The licence also includes 100% PVE owned Bagnolo in Piano deep (Cretaceous carbonates) oil discovery (three wells drilled by ENI in the 1980s).
Background on LA PROSPERA Permit
This licence, located in the Ferrara province north of Bologna, was awarded in September 2008. A subsequent seismic interpretation of 68km of ENI seismic lines has identified within the Quaternary sequence the Gradizza prospect, with predicted target depth of 1,000 metres and prospective best estimates gas resources of 265 MScm (9.3 bcf).
MScm : million standard cubic metres
bcf : billion cubic feet
2C : Best estimate contingent resources
Po Valley Energy
+39 06 4201 62 75
About Po Valley Energy
Po Valley Energy (ASX: PVE) is an oil and gas producer and exploration company listed on the Australian Stock Exchange. It has an expanding portfolio of hydrocarbon assets in northern Italy. Po Valley holds 11 license areas, encompassing 2,000 square kilometres and owns and operates two gas treatment plants. The Po Valley region is the main gas production zone in Italy. The Company's web site is www.povalley.com
Competent Person's Statement
Information in this report that relates to Hydrocarbon Reserves and or Resources is based on information compiled by Mr. Giovanni Catalano, CEO of Po Valley Energy who have consented to the inclusion of that information in the form and context in which it appears. Mr Catalano has over 30 years experience in Exploration and Development in the Oil and Gas Industry. He is a member of SEAPEX and AAPG and holds a masters Degree in Geology from the University of Ferrara, Italy.
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