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Mediterranean Oil & Gas says updated CPR gives Guendalina a 42 per cent bump
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.
