News & ASX Releases

Po Valley In First Gas Discovery In Italy Since Listing

May 18, 2005

Australian petroleum explorer and developer, Po Valley Energy (ASX: PVE), has discovered gas at its first well drilled in northern Italy since the Company’s listing on the ASX in December last year.

Po Valley announced today that its Vitalba-1 deviation well had discovered gas over three levels at between 1,577 — 1,620 metres depth for a total net pay of 4.3 metres over the measured 2.75 metres vertical depth.

“This compares with 5 metres of net pay in the neighbouring Agnadello-1 well, 400 metres away, which was drilled by ENI after the field’s discovery in 1978 and which produced 12.6 billion cubic feet (bcf) of gas over nine years,” Po Valley’s Chief Executive, Mr Michael Masterman, said today.

“This is an excellent start to our maiden exploration initiatives, particularly as the Vitalba-1 result confirms the success of the Company’s geological model for this gas rich province,” Mr Masterman said.

“The well logs show good porosity of 24-27% and no water and the gas appears to be held in thin beds interspersed with clay zones which should be positive for reservoir drainage and production.

“Reservoir thickness is expected to increase to the south near Agnadello-1.” “We will now proceed to case, perforate and production test Vitalba-1, with these results likely by early next week.”

The Vitalba-1 appraisal well is 100% owned by Po Valley and is located in the Vitalba field, 23 kilometres east of Milan in the Cascina san Pietro licence area. It contains estimated total remaining 1P reserves of approximately 3.6 bcf of gas within two gas bearing zones in the Argille del Santerno formation.

The licence area also contains the Pandino field which was given the development goahead by Po Valley earlier this year, targeting estimated 3P reserves of 45.3 bcf.

Mr Masterman said that as soon as the Vitalba-1 testwork is completed, the rig will move southeast to the Company’s 100% owned Sillaro-1 development well, near the city of Bologna.

“Sillaro is our principal drill target in the province for us this year, comprising two large anticline structures containing estimated total remaining 3P reserves of 53.4 bcf,” Mr Masterman said.

In addition to the drilling program, the Company plans its first commercial gas production by the end of this year from a well drilled last year in the Santa Maddalena interest, north of Bologna in which Po Valley has a 50% interest.

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

Hydrocarbon reserves have been estimated by Ecopetrol, the Consulting Geologist, using the definitions and guidelines of the SPE and WPC.

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