Cygam Receives Final Government Approval for Civitaquana Permit
Cygam Energy says that its wholly owned subsidiary, Vega Oil S.p.A., received the final ministerial approval for the Civitaquana exploration permit. The official decree was published in the monthly Italian Hydrocarbon Bulletin of August 2007, which was issued on September 1, 2007.
Vega is the operator and has a 60% working interest in the Civitaquana permit. In addition, Cygam has acquired a 5% carried interest in all exploratory costs, including drilling of the first well. This onshore permit is located in the Marche-Abruzzi Basin of central Italy, west of the onshore Miglianico discovery wells and west of the B.R268.RG Permit, located offshore in the Adriatic Sea. The permit is 615.37 square kilometers in size (152,056 acres) and will be valid for a period of six years. Cygam is committed to purchase and reprocess approximately 100 kilometers of seismic data and acquire approximately 60 kilometers of new 2D seismic data within the first 12 months from official approval. If seismic interpretation validates the preliminary assessment of the permit potential, the Corporation will have to commit to drilling a well to a total vertical depth of approximately 4,500 meters within 48 months.
Three primary targets are believed to exist on the Civitaquana block: a Miocene calcarenite at a depth of approximately 1,500 meters, the intra-Cretaceous Maiolica Formation (which tested 2,500 barrels of light oil per day and 3.5 million cubic feet per day of natural gas in the Miglianico discovery well) and the under-laying Jurassic carbonates of the Massiccio Formation. An additional objective is the upper Cretaceous Scaglia Formation, which can be encountered at drilling depths of approximately 2,500 to 3,000 meters. Existing seismic lines suggest the possibility of large structures and stratigraphically controlled prospects.
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