On December 3, 2009, Mediterranean Oil & Gas (MOG) submitted the Environmental Impact Assessment Study ("EIAS") for its 100%-owned Ombrina Mare field to the Italian Ministry of Environment. This submission follows the technical approval of the Ombrina Mare Field Development Plan by the CIRM committee of the Ministry of Environment, issued on June 23, 2009. MOG aims to have completed the environmental approval process by the third quarter of 2010, and is targeting the final grant of the full production license by the end of 2010.
In addition, the Company remains on schedule with the execution of several key post-drilling technical studies. Initial results of these studies are encouraging and MOG is pleased to announce that it is planning to request a review and update of the independent certification of the field's oil reserves. The Company intends to publish the full certification report in the first quarter of 2010.
Background on Ombrina Mare Production Concession Application (d30 BC MD):
The application for the production concession to permit development of the Ombrina Mare Oil & Gas Field was submitted on December 17, 2008. It covers an offshore area of approximately 100 sq.km. in the central Adriatic Sea.
The Ombrina Mare field development plan ("FDP") has been designed by Proger SpA to produce the field's 20 MMbbls and 6.5 Bcf of certified 2P oil and gas reserves.
Oil is trapped in a Miocene and Cretaceous carbonate platform reservoir and gas is trapped in 16 reservoir horizons in the middle-upper Pliocene gas sands complex. The OM2dir well produced 17-19 °API oil at a rate of approximately 1,000 bbls/d, without any formation water. The OM2dir well was completed as an oil producer and a temporary platform has been put in place.
The proposed development plan comprises:
The current estimated capital expenditure for the FDP amounts to between €150 and €180 million, based on prices prevailing in 2008.
Under the FDP, gross oil and gas production from the main Ombrina Mare field is targeted to progressively increase to a peak of 5,000 to 7,500 bbls/d of oil and 3.5 MMcf/d of gas. In the Company's development scenario, production is now scheduled to start in late 2012 once all of the development wells have been drilled and the production facilities are in place.
An additional and contingent development plan has also been submitted in the application for the oil and gas production concession. This plan is directed at obtaining the approvals to appraise and explore the additional contingent and prospective oil and gas resources identified inside the Ombrina Mare production concession area and will be implemented once the main field is in production.
"The submission of the Environmental Impact Assessment Statement for the Ombrina Mare field just five months after receipt of technical approval of the Field Development Plan represents another operational success for the Company and again confirms MOG's technical and operational ability to progress this significant project on schedule," Sergio Morandi, the Company's CEO, stated.
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