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Mediterranean Oil & Gas (LON:MOG) today announced a three year extension to the exploration licence that hosts the Ombrina Mare oil and gas field.

It confirmed that exploration permit BR269 GC would now run until May 5 2015.

Ombrina Mare, believed to contain 40 million barrels of oil, is currently affected by Italy’s offshore drilling ban – which applies to areas up to five miles from the coastline and twelve miles from nature reserves.

However MOG has continued to hold talks with the Italian authorities about the restrictions.

"We are pleased that this licence extension has been granted and we see this as a positive sign in our on-going discussions with the Italian authorities regarding the issuance of a production concession for our proposed development of the Ombrina Mare field,” said chief executive Bill Higgs.

Meanwhile, Panmure Gordon analyst Leila Reddy said: “This extension is indeed a positive development, as it strengthens MOG’s arguments for a resumption of activities in this field. 

“We are cautiously optimistic that in time Ombrina Mare will be commercialised.”

Mediterranean Oil & Gas (LON:MOG) today announced a three year extension to the exploration licence that hosts the Ombrina Mare oil and gas field.

It confirmed that exploration permit BR269 GC would now run until May 5 2015.

Ombrina Mare, believed to contain 40 million barrels of oil, is currently affected by Italy’s offshore drilling ban – which applies to areas up to five miles from the coastline and twelve miles from nature reserves.

However MOG has continued to hold talks with the Italian authorities about the restrictions.

"We are pleased that this licence extension has been granted and we see this as a positive sign in our on-going discussions with the Italian authorities regarding the issuance of a production concession for our proposed development of the Ombrina Mare field,” said chief executive Bill Higgs.

Mediterranean Oil & Gas (LON:MOG) confirmed that gas production from the Guendalina field was in line with its expectations in the first quarter of 2012.

Guandalina, a ENI led venture, came on stream in October. Today MOG reported average gross gas production of 580,000 cubic metres per day during the first quarter.

This equates to 116,000 cubic metres a day for MOG, which has a 20 per cent stake in the venture. MOG will bank first quarter revenues of €4 million as a result.

Additionally MOG said that a 1,012 square kilometre 3D seismic programme offshore Malta, in Block 4. The results are expected in the early part of the third quarter.

"We have made a very solid start to the year in delivering both reliable cash flow from our producing assets in Italy, and acquiring the seismic data required to evaluate our prospective resources offshore Malta," said chief executive Bill Higgs.

The company told investors that it plans to repay €2 million off its short term loan facility, provided by Och-Ziff Capital Management. The company will then be debt free, it said.

On the open this morning MOG shares were up 0.4p, or 6 per cent, trading at 6.25p each on AIM.

The upgrade was the result of a revised independent competent persons’ report produced by RPS Energy, which gives a net present value of MOG's 2P net reserves of €27.2 million using a 10 per cent discount rate.

Mediterranean Oil & Gas (LON:MOG) has hired former Chevron strategist Dr Bill Higgs as its new chief executive.

Higgs has over 23 years experience in the oil and gas industry. Most recently he was senior vice president of operations in Chevron’s Saudi Arabia and Kuwait unit. Prior to that he was Chevron’s chief strategist, responsible for setting strategy for the oil major’s executive leaders.

"We are delighted that Bill has agreed to become our chief executive officer, bringing his extensive experience of international exploration and development to our board,” said chairman Keith Henry.

“His broad expertise and proven innovative and strategic leadership will be invaluable to the company."

Higgs said: "I am very much looking forward to working with the Board to help grow Mediterranean Oil and Gas. 

“This is a very exciting time for the company as we have a strong portfolio and there are many additional opportunities within the greater Mediterranean area."

Higgs officially joins the company next Monday. Interim CEO Sergio Morandi will then revert to his prior position of chief operating officer.

Mediterranean Oil & Gas (LON:MOG) today revealed it has agreed a deal to sell its entire net gas production from the Guendalina gas field.

Repower Italia has agreed to buy the gas over an initial period of one ‘thermal’ year. The contract renews automatically at the end of the initial period, unless terminated by either party.

The field is a joint venture with ENI, which has an 80 per cent interest and is the operator.

Production began in October. Initial production figures, released in November, showed that Guendalina’s contribution had quadrupled the firm’s gas production from 40,000 cubic metres per day to 160,000 cubic metres.

Last month MOG reported a 42 per cent increase in the proven and probable reserves of the Guendalina gas field, offshore Italy.

The figure rises to a gross 31.2 billion cubic feet of recoverable 2P reserves, with 6.2bcf net to MOG, which has 20 per cent of Guendalina. The field, 47 miles of the Italian coast, is majority owned by the local major ENI.

The upgrade was the result of a revised independent competent persons’ report produced by RPS Energy, which gives a net present value of MOG's 2P net reserves of €27.2 million using a 10 per cent discount rate.

Mediterranean Oil & Gas Plc (LON:MOG) this morning unveiled a 42 per cent increase in the proven and probable reserves of the Guendalina gas field, offshore Italy.

The figure rises to a gross 31.2 billion cubic feet of recoverable 2P reserves, with 6.2bcf net to MOG, which has 20 per cent of Guendalina. The field, 47 miless of the Italian coast, is majority owned by the local major ENI.

The upgrade was the result of a revised independent competent persons’ report produced by RPS Energy, which gives a net present value of MOG's 2P net reserves of €27.2 million using a 10 per cent discount rate.

Sergio Morandi, the company’s chief operating officer, said: "We are very pleased to announce that, following the successful start-up of the Guendalina field last October, daily gas production is meeting our pre-development forecasts. 

“Guendalina's good production rate, combined with RPS's independent valuation which increases our recoverable 2P reserves by 42 per cent, is a key milestone for the development of our business plan and significantly increases the company's net production and revenues."

Last month MOG confirmed it had transferred the gas sales contract for the Guendalina gas field to Italian utility Energetic with the new arrangement coming into effect today. 

Net revenues from the field are expected to be around €12 million per year. This is based on anticipated production of around 20 million cubic feet of gas per day (20 percent net to MOG) and forecast gas prices.

Production began in October. Initial production figures, released in November, showed that Guendalina’s contribution had quadrupled the firm’s gas production from 40,000 cubic metres per day to 160,000 cubic metres.

Mediterranean Oil & Gas (LON:MOG) today confirmed that it has transferred the gas sales contract for the Guendalina gas field to Italian utility firm Energetic SpA.

This new arrangement will be in effect from February 1.

The field is a joint venture with ENI, which has an 80 per cent interest and is the operator.

Net revenues from the field are expected to be around €12 million per year. This is based on anticipated production of around 20 million cubic feet of gas per day (20 percent net to MOG) and forecast gas prices.

The gas field contains independently certified 2P gas reserves of 22 billion cubic feet and is expected to achieve aggregate gas production of around 20 million cubic feet per day – which equates to 4 million cubic feet per day net to MOG. 

Production began in October. Initial production figures, released in November, showed that Guendalina’s contribution had quadrupled the firm’s gas production from 40,000 cubic metres per day to 160,000 cubic metres.

Mediterranean Oil & Gas (LON:MOG) this afternoon announced that Michael Bonte-Friedheim is stepping down from his position as interim chief executive with immediate effect.

Sergio Morandi has been appointed as interim chief executive while the group looks for a new permanent chief executive.

"I would like to thank Michael for his contribution to the company over the past five years, both as chairman and more recently as interim CEO,” said chairman Matthew Clarke

“His leadership was fundamental in securing MOG's future. 

“He leaves the company in a strong financial position, with excellent assets on which to build the company in the future." 

The operator ENI – which owns the remaining 80 per cent of the field – started gas production from there on Tuesday night, MOG said. 

"We are extremely pleased to announce that gas production at the Guendalina field has commenced,” said MOG’s chief operating officer Sergio Morandi

“The start up of Guendalina gas production is a key milestone in the development of the company's business plan that will significantly increase the company's net gas production and revenue."

The Guendalina production is expected to have a material positive impact on MOG’s revenues. According to the company its 20 per cent revenue share is likely to be in the order of €10.5 million in 2012 – about three times the group’s reported revenues last year. 

However it also said that the final project costs are likely to be about 7 per cent higher than previously thought. As a result it expects project capex to be about €15.5 million.

The offshore Guendalina gas field, which contains independently certified 2P gas reserves of 22 billion cubic feet, is expected to achieve aggregate gas production of around 20 million cubic feet per day – which equates to 4 million cubic feet per day net to MOG.

The current arrangements the gas will be sold at US$11.50 per thousand cubic feet (€0.306 per cubic metre). This is contracted for the next eleven months.

Mediterranean Oil & Gas (LON:MOG) has hired experienced City operator Stephen Matthew Clarke as a non executive director.

Clarke, who is currently a partner of corporate broker Merlin Partners LLP, has has over 20 years of experience in the financial markets as a corporate lawyer and as a banker. MOG highlighted that Clarke was instrumental in the £30 million refinancing – through the issue of shares and the conversion of debt into equity – in May this year.

According to MOG Clarke brings to the board considerable experience and a broad range of skills from his legal and banking background.

"I am pleased to welcome Matthew to the board and feel sure that his commercial experience and expertise will be of great benefit to the company," said chairman Andrew Cochran.