www.aurelianoil.com
Aurelian Oil & Gas PLC, was founded in December 2002, and is focused on the re-emerging Central and Eastern European oil and gas markets, the oldest producing oil province in the world.
Current projects span the region from Poland to Bulgaria, with production in Romania, a deep appraisal well drilled on a large structure in Poland in March 2007 to be developed with a further horizontal well to be drilled in 2010, together with exciting exploration prospects including projects in four countries, Romania (4 blocks), Slovakia (3 blocks), Bulgaria (2 blocks) and Poland (14 blocks). Aurelian is the operator in all of these except Bulgaria.
Aurelian Oil & Gas contingent resources increased 270 pct in latest independent report to 372 bln cubic feet
Aurelian Oil & Gas (AIM: AUL) said a new independent report on its petroleum interest has increased the group’s total contingent gas resources to 372 billion cubic feet, compared with its own preliminary estimates of 138 bcf used in its market update of October 26, an increase of 270 percent.
The total prospective gas resource estimate was raised by 261 percent to 1,267 bcf from 481 bcf, and total prospective oil resources to 385 mmbbls from 105 mmbbls, an increase of 367 percent.
The draft competent persons report released to the company by Gaffney Cline & Associates leads Aurelian to calculate a total risked EMV (estimated monetary value) of €1.49 billion equivalent to £5.64 per share and an increase of 381 percent from the £1.48 per share shown in its October announcement.
Shares in the Europe focused exploration and production group were up more than 17 percent in London morning deals on the news.
CEO Rowen Bainbridge commented: "GCA's report confirms what we have always believed to be the case - Aurelian has an exceptional portfolio of appraisal and exploration assets. Aurelian has to date been conservative in its approach and has generally understated its resource base. We wanted an independent root and branch review to validate the company's estimates and to classify them under the Petroleum Resource Management System (SPE PRMS) so that our stakeholders could clearly see what we have and what value it contains.”
The new report further endorses Aurelian's strategy of focusing on the two core areas of the Rotliegendes and Zechstein plays in Central Poland and Western Poland and the Carpathian Thrust fold belt in Southern Poland, Slovakia and Western Romania where the greatest value of its portfolio is seen to be, while exiting the other non core areas, he added.
Notably, the report has increased the mid-case contingent resource estimate for the flagship Siekierki gas field in Poland to 346 bcf from 132 bcf.
Aurelian's objective is to convert its extensive appraisal and exploration portfolio into proven reserves and production, creating a balanced portfolio by 2011, the company said.
Only last week, the company confirmed that a competent persons report by Gaffney Cline was nearly complete and that it would include a resource upgrade of its the Siekierki project, following a snippet in the Financial Times suggesting the company “could soon announce a large gas find”.
Aurelian announced in its October update that it had, through its 90 percent owned subsidiary Energia Zachod, entered into an agreement with Kulczyk Investments SA for the sale of gas produced from EZ's Siekierki field, for gas produced from test wells during an initial 6-month period and a subsequent fully-termed agreement which will run for an initial 10 years. Kulczyk holds approximately 10 percent of Aurelian.
In November, it pleased investors with news that testing the shallower sections of Voitinel-1 well of the Brodina block in Romania showed commercial gas rates, only a month after disappointing tests of the deeper sections, which had come up dry. Aurelian Oil & Gas holds a 33.75% interest in the Voitinel well, while S.N.G.N. Romgaz S.A. holds 37.50% and Europa Oil & Gas has a 28.75% interest.
Over the next two years, the group is planning an exploration program drilling up to 9 wells in the Carpathian Thrust Fold belt. In Romania, Aurelian will exit for value the Sarmatian exploration play - except Suceava - and focus only in the Carpathian Thrust Fold belt in the West of its Cuejdu block. It further plans to drill up to three wells in Bulgaria, bring these operations on early cash flow and then monetise this non-core area.
The company plans to grow its portfolio in its two core areas organically in the short term, and through M&A in the medium term.
It envisages announcing a partner for Siekierki in 2010.
Further in 2010, it plans to spud the Suceava, Siekierki 2 and spud and test the Siekierki 3 wells and farm out or sell the non-core Romanian assets. The year will also see spudding of the Bulgaria 1 and 2 wells and drilling of the Bieszczady 1 well.
