Update on Irish Atlantic Margin Prospects
Europa Oil & Gas (Holdings) plc / Index: AIM / Epic: EOG / Sector: Oil & Gas
16 January 2013
Europa Oil & Gas (Holdings) plc ('Europa' or 'the Company')
Technical Update Including Unrisked Indicative Resources for Kiernan Prospect
in the Irish Atlantic Margin
Europa Oil & Gas (Holdings) plc, the AIM listed oil and gas exploration,
development and production company focused on Europe, is pleased to provide a
technical update on its 100% owned Licensing Options ('LO') 11/7 and LO 11/8,
covering a total area of approximately 2,000 sq km and located in the highly
prospective South Porcupine Basin in the Irish Atlantic Margin ('IAM'), where
two large, previously unknown prospects, Mullen and Kiernan, were identified on
Europa's acreage in September 2012.
Highlights
- First pass seismic mapping over the Kiernan prospect has been completed with
positive results
- Primary focus has been on the Cretaceous clastic section where stratigraphic
traps have been identified in three reservoirs: Barremian, Valanginian A and
Valanginian B
- Barremian - Mean unrisked indicative resources estimated at 355 million barrels
of oil (mmbo) in the oil case or 2.3 tcf in the gas case (oil is considered to
be the most likely hydrocarbon type)
- Valanginian A - Mean unrisked indicative resources estimated at 5.8 tcf in the
gas case or 977 mmbo in the oil case (gas is considered to be the most likely
hydrocarbon type)
- Valanginian B - Mean unrisked indicative resources estimated at 1.9 tcf in the
gas case or 280 mmbo in the oil case (gas is considered to be the most likely
hydrocarbon type)
- Total mean unrisked indicative resources for the three reservoirs is estimated
at 1.612 billion barrels in the oil case or 10 tcf (1.667 billion barrels of oil
equivalent) in the gas case
- Technical work is continuing on additional prospectivity identified elsewhere
in the Licence area in the Paleocene section and pre-rift Jurassic and Triassic
sections
- Europa believes the South Porcupine Basin has the potential to host a new
hydrocarbon province and is encouraged by the results of the initial prospect
evaluation
- Europa is seeking a joint venture partner or partners to undertake further
technical work to de-risk the Mullen and Kiernan prospects and mature them to
drillable status
Hugh Mackay, CEO of Europa, commented, "First pass seismic interpretation over
Kiernan has proved positive and we are pleased to announce potentially large
stratigraphic traps at three levels in the Cretaceous clastic section.
Elsewhere in the LO 11/8 area there is potential for additional prospectivity
in the Paleocene section and pre-rift Jurassic and Triassic sections which
warrant further investigation. Whilst these initial results are highly
encouraging, more work, including a 3D seismic survey is required to further
de-risk the Kiernan prospect and mature it to drillable status.
"We recently estimated mean unrisked indicative resources of 482 million
barrels of oil for our Mullen prospect on LO 11/7. Exploration success at
either of our Irish prospects would therefore be transformative for Europa.
We will now be opening a data room for both our Irish Licences, with a view to
securing a joint venture partner or partners with whom we can further mature
both Mullen and Kiernan. We are not alone in believing the South Porcupine
Basin could host a new hydrocarbon province and a carbonate prospect in the
basin located just 65kms away from Kiernan will be tested by ExxonMobil's
Dunquin well later this year. This is an exciting time for Europa, as we look
to advance our balanced portfolio of assets, which also includes onshore UK
production and exploration as well as a large onshore France gas appraisal
project, and in the process build substantial value for all our shareholders."
The Mullen and Kiernan Prospects:
Europa has 100% equity in two licensing options in the South Porcupine Basin in
the Irish Atlantic Margin both approximately 1,000sq km in size. LO 11/7 is
over blocks 43/9, 43/10, 43/14 and 43/15 whilst LO 11/8 is over blocks 54/1, 54
/2, 54/6 and 54/7. Within these Licensing Options, Europa has identified two
prospects: Mullen within 11/7 and Kiernan within 11/8. First pass seismic
interpretation over both the Mullen and Kiernan prospects has been completed.
Europa announced the results for Mullen on 6 November 2012.
Licence option 11/8 is located on the east flank of the South Porcupine basin
some 145 km offshore southwest Ireland. The licence contains the Cretaceous
Kiernan prospect as well as additional prospectivity elsewhere in the licence
area in the Paleocene and in the pre-rift Jurassic and Triassic.
The Kiernan prospect is a stack of three stratigraphic traps at various levels
within the Cretaceous section: Barremian, Valanginian A and Valanginian B.
Reservoir at the Barremian and Valanginian A levels are interpreted to be
deepwater turbidite sandstones. The Barremian is the shallowest with a depth to
crest of 3,700 metres below the mudline ('mbml') followed by the Valanginian A
at 4,475mbml. Reservoir in the Valanginian B is considered to be a more
proximal Brae-type fan sandstone with depth to crest estimated at 4,775mbml.
The sandstones are considered to be derived from Devonian Old Red Sandstone in
the Munster basin on the Irish mainland. Hydrocarbon type in the Middle
Cretaceous reservoir is predicted to be most likely oil. Hydrocarbon type in
the Valanginian A and B reservoirs is predicted to be most likely gas.
Oil prone marine source rocks are anticipated in the Late Jurassic and
Cretaceous intervals. The Late Jurassic source is regarded as well proven in
the region and is likely to be in the gas window present day if developed at
the prospect. Absence of relevant drilling means that the Cretaceous source is
not proven in the region, if present at the prospect it is predicted to be in
the oil window present day. Trap size at all three levels is potentially
large. Containment for top seal and bottom seal is provided by Cretaceous
mudstones.
Unrisked indicative resources for the three Cretaceous reservoirs are tabulated
below:
Gas
Water Depth to Oil case (mmbo) Gas case (tcf) case
Reservoir depth crest mbml (mmboe)
(m) (m)
P90 P50 P10 Mean P90 P50 P10 Mean Mean
Barremian 1800 3700 78 269 746 355 0.6 1.8 4.6 2.3 383
Valanginian 1925 4475 189 712 2063 977 1.5 4.7 11.5 5.8 967
A
Valanginian 1925 4775 29 130 710 280 0.2 0.9 4.7 1.9 317
B
Total 1612 10.0 1667
Geological risk is considered to be high and further technical work is required
to de-risk the prospect and mature it to drillable status. A key step is to
acquire 3D seismic over the prospect.
The primary play in the Mullen prospect in 11/7 on the west flank of the south
Porcupine basin comprises Early Cretaceous turbidite sandstone reservoirs.
These reservoirs are charged by mature Late Jurassic and Early Cretaceous
organic-rich marine shales. Mullen is a stratigraphic trap, reliant upon updip
pinch-out of the turbidite reservoir on to a mud-dominated slope succession.
The trapping configurations are analogous to the Jubilee and Mahogany fields
in the equatorial Atlantic Margin province.
The Early Cretaceous play is proven in the North Porcupine Basin by the Burren
oil discovery made by Phillips in 1978 which flowed circa 700 barrels of oil
per day of 34 API oil. The South Porcupine Basin is essentially undrilled and
technical success at the upcoming ExxonMobil Dunquin well, which is expected to
be drilled in 2013, may help de-risk some source rock elements of the Lower
Cretaceous clastic play.
The option period for both licences is from 1 November 2011 to 30 October 2013.
Europa has implemented the technical work programme required for the licence
option period, which involves the integration and interpretation of existing
2-D seismic and well data sets, and reprocessing of selected 2-D seismic data.
Subject to the fulfilment of this work programme, government approval and a
minimum 25% relinquishment, a 15 year Frontier Exploration licence may be
obtained.
* * ENDS * *
For further information please visit www.europaoil.com or contact:
Hugh Mackay Europa +44 (0) 20 7224 3770
Phil Greenhalgh
Matt Goode finnCap Ltd +44 (0) 20 7220 0500
Henrik Persson
Frank Buhagiar St Brides Media and Finance Ltd +44 (0) 20 7236 1177
Lottie Brocklehurst
Notes
Europa Oil & Gas (Holdings) plc has a diversified portfolio of multi-stage
hydrocarbon assets that includes production, exploration and development
interests, in countries that are politically stable, have transparent licensing
processes, and offer attractive terms. The Company currently produces
approximately 180 boepd in the UK, generating sufficient revenues to cover
corporate overheads. In addition, it has highly prospective exploration
projects in the UK, Ireland and France.
Qualified Person Review
This release has been reviewed by Hugh Mackay, Chief Executive of Europa, who
is a petroleum geologist with 30 years' experience in petroleum exploration and
a member of the Petroleum Exploration Society of Great Britain, American
Association of Petroleum Geologists and Fellow of the Geological Society. Mr
Mackay has consented to the inclusion of the technical information in this
release in the form and context in which it appears.