The two offshore Adriatic licenses are adjacent to licenses FR39.NP and FR.40.NP which contain three oil discoveries: Rovesti, drilled by Agip in 1978; Medusa, drilled by Enterprise Oil in 1996; and Giove, drilled by Enterprise Oil in 1998. The Giove-1 wells established a 183-meter (600 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.
Independent engineers commissioned to review the Giove discovery to verify the reserve potential and the development options will soon report on their evaluation studies, with results likely to be announced later this month. Analysis of the Medusa and Rovesti oil discoveries will follow.
Recent bids by Cairn Energy Plc for MedOil Plc and Plectrum Petroleum Plc highlight the fact that big oil is waking up to the potential of the offshore Mediterranean region to host significant oil discoveries and develop further resources. Northern expects there to be further corporate activity in the region and is delighted that it has already established such a significant portfolio in prime locations.
NPUK holds a 100% interest in the licenses awarded today but a subsidiary of ATI Oil Plc, in which Northern holds a 37.52% equity interest, has a 50% pari-passu commercial interest in both licenses, giving Northern a net beneficial interest of 68.76%.
Northern is the operator of 24 licenses, preliminary awards and uncontested applications in Italy, covering an area in excess of 13,000 kmē, being second to Eni in acreage under management in Italy.
Derek Musgrove, Managing Director of Northern said: "The preliminary award of these licenses, adjacent to the discoveries being planned for appraisal and FPSO development, provides exciting potential in a region that will become another core area for Northern. We expect that the five contiguous licenses and preliminary awards in the Southern Adriatic to contain the potential to transform the value of the Company. The area has seen no activity since the earlier successes of Enterprise Oil in the late 1990s, in an era of significantly lower oil prices."
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