Italy: Selva Malvezzi Q1 2024 Activity Report

Prospex Energy PLC

03 May 2024

 

Prospex Energy PLC / Index: AIM / Epic: PXEN / Sector: Oil and Gas

3 May 2024

Prospex Energy PLC

("Prospex" or the "Company")

Italy: Selva Malvezzi Production Concession

Q1 2024 Activity Report

Prospex Energy PLC (AIM: PXEN), the AIM quoted investment company focused on European gas and power projects, is pleased to provide an update from the Selva Malvezzi production concession in Italy following the publication by Po Valley Energy Limited ("Po Valley Energy") (ASX: PVE) of its Q1 2024 activity report.  Po Valley Operations Pty Limited ("PVO"), a wholly owned subsidiary of PVE is the operator of the Selva Malvezzi production concession, which has a 63% working interest, while Prospex has the remaining 37% working interest.

Highlights

·    The Podere Maiar-1 well at Selva ("PM-1") has continued to perform consistently during Q1 2024.

·    Average daily production for the quarter was in the order of ~80,000 scm/d.

·    A standard slickline operation in March 2024 confirmed strong pressure build up confirming the average daily production rate for the foreseeable future.

·    PM-1 is supplying the gas to BP Gas Marketing under an 18-month offtake agreement.

·    The weighted average gas sales price for the quarter was €0.30/scm (~€29/MWh).

·    Gross Quarterly production was 6,385,255 scm of gas (2,362,544 scm net to Prospex) and gross revenue for the quarter was €1,906,891 (€705,549 net to Prospex).

·    The operator is progressing the permitting process with the regulatory authorities on the other projects in the Selva Malvezzi production concession.

·    Following a successful project of reprocessing the existing 2D seismic lines in the production concession, the Joint Venture is now evaluating the potential for a new seismic acquisition programme over the licence area in order to optimise the drilling programmes of the identified contingent resources at Selva North, Selva South and the East Selva and Riccardina prospects.

Gas production at the PM-1 gas facility in the Selva Malvezzi Production Concession for the quarter is shown in the table below:

PM-1 Gas Production Q1 2024
PM-1 Production (scm)	January 2024	February 2024	March 2024
PM-1 - 100%	1,940,940 scm	2,306,760 scm	2,137,555 scm
PM-1 - 37% (Prospex share)	718,147 scm	853,501 scm	790,895 scm

Production has been consistent throughout the quarter averaging ~78,000 scm/d to ~80,000 scm/d, with exception of days during which slickline operations were undertaken.  During the quarter, the operator carried out three slickline operations.  The first was conducted in early January 2024 confirming results from December 2023, the second was conducted at end of January with the third programme completed in late March 2024.  All results of bottom hole pressure and temperature readings in static conditions were in line with expectations with ongoing monitoring for any debris undertaken to ensure no accumulation issues were present.

Mark Routh, Prospex's CEO, commented:

"Po Valley Energy continues with safe and reliable operations at the Selva Malvezzi production concession. 

"We are actively advancing  the necessary activities to facilitate development drilling programmes at Selva Malvezzi with the target of converting the contingent resources at Selva North and Selva South and the prospective resources at East Selva and Riccardina into proved, developed and producing reserves in the near term."

This announcement contains inside information for the purposes of Article 7 of the Market Abuse Regulation (EU) 596/2014 as it forms part of UK domestic law by virtue of the European Union (Withdrawal) Act 2018 ("MAR") and is disclosed in accordance with the Company's obligations under Article 17 of MAR.

* * ENDS * *

For further information visit www.prospex.energy or contact the following:

Mark Routh	Prospex Energy PLC	Tel: [phone]
Ritchie Balmer Rory Murphy	Strand Hanson Limited	Tel: [phone]
Lional Therond / Daniel Fox-Davies	Fox-Davies Capital Limited	Tel: [phone]
Andrew Monk (Corporate Broking) Andrew Raca / Alex Cabral (Corporate Finance)	VSA Capital Limited	Tel: [phone]
Ana Ribeiro / Charlotte Page	St Brides Partners Limited	Tel: [phone]

Notes

Prospex Energy PLC is an AIM quoted investment company focused on high impact onshore and shallow offshore European opportunities with short timelines to production.  The Company's strategy is to acquire undervalued projects with multiple, tangible value trigger points that can be realised within 12 months of acquisition and then applying low-cost re-evaluation techniques to identify and de-risk prospects.  The Company will rapidly scale up gas production in the short term to generate internal revenues that can then be deployed to develop the asset base and increase production further.

About Selva:

The Selva Malvezzi Production Concession is in the Po Valley region of northern Italy.  The concession contains the Selva gas-field as well as exciting exploration and development opportunities.  The Podere Maiar-1 well at Selva was completed in December 2017 and successfully found a commercial gas accumulation up-dip of the previous wells on the Selva field.  The Company has a 37% working interest in the Production Concession held via Prospex's two wholly owned subsidiaries, PXOG Marshall Ltd (17% of the Licence) and UOG Italia Srl (20% of the Licence).

The Selva Malvezzi Production Concession holds independently verified 2P gross proven reserves of 13.4 Bcf (5.0 Bcf net to Prospex at 37% WI) in Selva, gross Contingent 2C Resources of 14.1 Bcf (5.2 Bcf net) and a further 88.2 Bcf of gross Best Estimate Prospective Resources (un-risked) (32.6 Bcf net).^[1]

An independent Competent Person's Report of the Podere Gallina Licence which was converted into the Selva Malvezzi Production Concession at first gas in July 2023, was prepared by CGG Services (UK) Limited in July 2022 on behalf of the joint venture.^[1] It attributed a total of 379 MMscm (13.4 Bcf) gross 2P reserves for the Selva redevelopment project.

References:

[1] Source: "Competent Person's Report Podere Gallina Licence, Italy" prepared by CGG Services (UK) Limited in July 2022 : https://bit.ly/44VF02A

Glossary:

scm                        Standard cubic metres

scm/d                   Standard cubic metres per day

MMscm               Million standard cubic metres

Bcf                          Billion standard cubic feet

MMscfd               million standard cubic feet per day

MWh                     Mega Watt hour

TTF                         The 'Title Transfer Facility' - a virtual trading point for natural gas in the Netherlands.

Qualified Person Signoff

In accordance with the AIM notice for Mining and Oil and Gas Companies, the Company discloses that Mark Routh, the CEO and a director of Prospex Energy plc has reviewed the technical information contained herein.  Mark Routh has an MSc in Petroleum Engineering and has been a member of the Society of Petroleum Engineers since 1985.  He has over 40 years operating experience in the upstream oil and gas industry.  Mark Routh consents to the inclusion of the information in the form and context in which it appears.

 

END