By Jerom Bolt
Romania is still rich in natural resources of oil and gas, despite the fact that its exploitation is over 100 years. In fact, Romania is renowned for its experience, and its industry celebrated 160 years of oil refining in 2017.
When they descended in Romania, the British of Prospex did not expect their shares to grow over 40% on the London Stock Exchange in one day.
The company Prospex Oil and Gas announced on Monday that Raffles Energy, the operator of the Bainet-1 well in Romania, had made a discovery of new gas in the exploration area.
Bainet-1, of which Prospex held a 50% interest via its subsidiary PXOG Massey, was drilled to a depth of 600m where it encountered a 9m "good quality" sandstone reservoir with 8m of net gas pay.
The two intervals tested within the main gas pay zone were perforated at a measured depth of 513.3-514.8m and 516.3-517.3m.
During the final 11-hour test, natural gas containing over 99% methane flowed at a rate of approximately 33,000 cubic metres per day through an 8mm choke.
The company noted that Bainet-1, which had been in conservation for some time, was waiting for the receipt of relevant permits and approvals, and expected that experimental production from the Bainet gas discovery would begin during the second quarter of 2018.
Prospex non-executive chairman, Bill Smith, said, "To have made a commercial gas discovery with just the second well in which we have participated is, in our view, testament to the quality of the technical work we carry out when evaluating potential projects and also our focus on minimising risk wherever possible."
"With first production in Romania and drilling results in Italy expected in the near term, we are delivering on our objective to expose our shareholders to value trigger events and I look forward to providing further updates in due course," he added.
Prospex Oil & Gas recently acquired from Raffles Energy SRL, a wholly-owned subsidiary of Raffles Energy Group, a 50% stake in the exploration rights related to the EIV-1 hydrocarbon concession in Suceava, northeastern Romania, for which it paid 750,000 euro. The agreement signed with Raffles envisaged an exploration area in the Suceava concession, which includes an underdeveloped hydrocarbon discovery at Grăniceşti and several prospecting licenses in different stages of development. At the same time, Prospex has pledged up to 550,000 euros to contribute to the exploration program spending in the second half of 2017.
The agreement between Prospex and Raffles included the Bainet methane gas well project, which Raflles, as operator of the Suceava concession, planned to drill in September.
Prospex Oil & Gas is an oil and gas investment company listed on the AIM market of the London Stock Exchange. The company's portfolio includes, among others, a 49% stake in Hutton Poland, the owner of the Kolo concession rights in central Poland.
Raffles Energy SRL, based in Bucharest, is among the top five natural gas producers in Romania, after Romgaz and OMV Petrom (which accounts for about 90% of total domestic production) and Amromco Energy. Drill Probe and Stratum Energy complete the group of small gas producers in Romania. The company is a subsidiary of Raffles Ltd. UK, part of Raffles Energy Group's private equity group, owned by Furkhat Ibragimov, one of the sons of Uzbek billionaire Alijan Ibragimov. In Romania, Raffles owns 62.5% of the Ellie-1 Brodina block - Bilca production area, 50% of Edinburgh-Edinburgh-1 block Brodina - Voitinel production area, 50% of the Suceava exploitation perimeter, and Dornesti Sud and the Dorneşti gas plant, 100% of exploration rights related to the Suceava concession and 60% of the EIII-4 Bacău block - Bacău North production area.