News & ASX Releases

Po Valley Drills Largest Italian Gas Prospect

June 7, 2005

Australia’s Po Valley Energy (ASX: PVE) has commenced drilling its largest gas target in Italy — the Sillaro-1 appraisal well, 30 kilometres east of Bologna. The ASX-listed petroleum explorer and developer announced today that its 100%- owned Sillaro-1 well had spudded overnight, representing the most critical exploration activity for the company since its listing last December.

“This target is within one of the richest gas provinces in northern Italy and is just 50 metres from pipeline infrastructure so commercial success will deliver almost costless connection to a national gas distribution network,” Po Valley’s Chief Executive, Mr Michael Masterman, said today.

“With estimated 3P reserves of 53 billion cubic feet (bcf), Sillaro is the largest gas field in our portfolio and the commencement of drilling is a major step forward for the Company,” Mr Masterman said.

The Sillaro milestone comes only a month after the discovery of gas by Po Valley in its first well since listing, the Vitalba-1 deviation well further north from Sillaro near Milan. This well will be put on production test next week with a 3-5 day “rigless” production test.

The Sillaro field comprises two large anticline structures with the reservoir split into two levels of 12 bcf at 2,100 metres (PL-2 reservoir) and 41 bcf at 2,500 metres (MI-3 reservoir).

“The PL-2 reservoir has been validated by four previous wells and prior production test data indicates good porosity and permiability,” Mr Masterman said.

“This level is the principal focus of our development plans for this first well and we believe there is good probability of achieving commercial production rates.”

Sillaro-1 will be drilled to a depth of 2,800 metres over the next 30 days.

Mr Masterman said the Vitalba-1 discovery had been perforated, tubing run, and the well head set in place. Production rate testing will be started next week.

Michael Masterman Po Valley Energy 0417 851 303
Kevin Skinner Field Public Relations (08) 8234 9555 / 0414 822 631

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