Europa Confident about French Drill

Junior explorer Europa Oil & Gas said Tuesday that it was confident that next year will see "a number of key value triggers" for its French permit.

In the firm's annual general meeting statement, Europa Chairman Bill Adamson said:

"In tandem with launching a farm-out, we have already commenced the planning process to drill a well to test the 416-billion cubic foot Berenx shallow gas prospect. Subject to completing a farm out agreement or similar funding, we could be drilling a well to test the shallow gas prospectivity within the next 18 months. At an estimated drill cost of $6 million we believe drilling the Shallow prospect offers a clear route to monetizing the potential of this permit."

Adamson said the firm's UK portfolio offers a combination of production and low-risk exploration targets.

"Our three producing fields, which generated approximately GBP 4.5m [$7.4 million] in revenues in the last financial year, continue to help fund exploration work, most recently our share of 2D seismic acquisition costs on the 50-percent owned PEDL 181 license. We will shortly be releasing an updated geological model as well as a forward plan for this large undrilled license onshore UK.

"In addition we are funded to cover our share of drilling costs at the Wressle prospect in the East Midlands where a well is expected to spud early in 2014. This is later than envisaged due to Wressle being among the first conventional wells to have to comply with new EA regulations which has led to what we believe will be a short delay in the commencement of drilling."

Offshore Ireland, Europa partner Kosmos Energy recently funded the acquisition of 3D seismic covering both of Europa's Irish blocks in the South Porcupine Basin.

"We believe the speed with which Kosmos has acted since farming into an 85-percent interest in April 2013 demonstrates their commitment. Moreover we expect the progress made to date to continue in 2014, including the interpretation of the 3D data which could significantly de-risk the prospectivity already identified and potentially lead to a decision to drill a well on one or both blocks in 2015/16," Adamson said.

He concluded:

"2014 will not only see us drill Wressle, which has a one in three chance of materially adding to our existing production, but we believe will also see progress made in advancing our projects offshore Ireland and onshore France, as we look to deliver on our objective and build substantial value for shareholders."

Europa also used the statement to highlight a more than 50-percent increase in its combined net mean risked resources to 43 million barrels of oil equivalent, from 27 million barrels a year ago.

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