The Giove and Medusa oil and gas discoveries were drilled by Enterprise Oil during a period of low oil prices. These discoveries now require reappraisal in the light of current oil prices and recent advances in development technology.
The two wells, Giove-1 and Giove-2 established a 183 meter, (602 foot), hydrocarbon column with a 92 meter, (302 foot), oil leg of 16° API oil. Analysis at the time estimated the oil in place to be about 180 million barrels.
Work will immediately be undertaken to verify the oil in place volumes and establish the potential reserves of the Giove discovery prior to planning appraisal wells, to be designed as capable of production in a rapid oil development utilising a Floating Production, Storage and Offloading vessel. The nearby Medusa discovery will be considered for a tie back to the Giove facilities.
Independent engineers have been commissioned to review the Giove and Medusa discoveries to verify the reserve potential and the development options. Analysis of the Rovesti oil discovery will follow. Northern Petroleum (UK) Limited holds a 100% interest in the licenses but a subsidiary of ATI Oil Plc, in which Northern holds a 37.75% equity interest, has a 50% pari-passu commercial interest in both licenses, giving Northern a net beneficial interest of 68.88%.
Derek Musgrove, Managing Director, stated:
"These offshore licenses are in a core area for Northern. The Durres Basin extends from southeast Italy across the Adriatic to the oil provinces of Albania and Montenegro. We will now progress with the appraisal of the existing oil discoveries, that have the potential to transform the booked reserves and production revenues of Northern and to work further on the many already mapped leads and prospects that encouraged us to apply for these two and three further applications in the area.
"We expect to be able to progress these first two licenses with strategic par tners providing technology, drilling and facilities to the project in return for a reduction in our equity or future production share, thereby reducing our equity capital requirements for appraisal and development.
"The awards have been long awaited, but are assets of high potential and so are to be pursued with vigor. I hope that shareholders may appreciate my excitement for a project that has taken over two years to reach this stage. I can now at last say let's go!"
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