Europa Oil & Gas (Holdings) Plc New Prospect Inventory for LO 16/20, Offshore Ireland

 
TIDMEOG 
 
Europa Oil & Gas (Holdings) plc / Index: AIM / Epic: EOG / Sector: Oil & Gas 
 
26 February 2019 
 
          Europa Oil & Gas (Holdings) plc ('Europa' or 'the Company') 
 
             New Prospect Inventory for LO 16/20, Offshore Ireland 
 
Europa Oil & Gas (Holdings) plc, the UK and Ireland focused oil and gas 
exploration, development and production company, is pleased to announce a new 
prospect inventory for Licensing Option ('LO') 16/20 in the Slyne basin in 
Atlantic Ireland. LO16/20 includes the Company's flagship Inishkea prospect 
which lies immediately to the north west of, and abuts, the producing Corrib 
gas field in the Corrib Field Petroleum Lease Area. 
 
Highlights: 
 
  * Inishkea gross mean un-risked prospective gas resources of 1.5 trillion 
    cubic feet ('TCF') 
  * Chance of success estimated as 1 in 3 
  * Site survey planned for summer 2019, targeting a well, subject to funding 
    and regulatory consent, in 2020 
  * Farm-in negotiations ongoing with a major oil and gas company in respect of 
    three of Europa's offshore Ireland licences, including LO 16/20 which holds 
    Inishkea 
 
Europa's CEO, Hugh Mackay, said: "Our very detailed and thorough technical work 
confirms Inishkea to be a large, robust, low risk, gas prospect. The early 
promise we identified has been validated and the prospect has now been 
de-risked significantly. Inishkea's location in a proven play, and close 
proximity to the nearby Corrib gas field and facilities informed our decision 
to elevate the prospect to flagship status. With 1.5 TCF of gross mean 
un-risked prospective gas resources, and a 33% chance of success, the prospect 
has exceeded our expectations. 
 
"We will press on with our operational planning to enable a site survey in 
summer 2019 and a well targeting Inishkea, subject to funding and regulatory 
consent, in 2020. Since opening the farmout dataroom in December 2018 we have 
had several large oil companies review the prospect and we are updating them 
with this new information. Separately, our ongoing farm-in negotiations with a 
major international oil and gas company for three of our licences, FEL 1/17, 
FEL 3/13, and LO 16/20 which holds Inishkea are progressing. Subject to 
successful completion, Europa will have a clear line of sight to the drilling 
of a series of wells offshore Ireland, each of which has company-making 
potential." 
 
Further Information 
 
Europa has completed Pre-Stack Depth Migration ('PSDM') reprocessing of 770km2 
of 3D seismic data over the Inishkea prospect, including the area of the Corrib 
gas field. In addition, Europa has purchased 1,544 km2 of released 3D seismic 
data shot over, and immediately adjacent to, the LO area, 5,000 km of regional 
2D and 13 wells. Europa has further purchased Ocean Bottom Cable 3D seismic 
data over the Corrib gas field and used it to successfully benchmark and 
calibrate the PSDM data and the resulting geophysical interpretation and 
mapping. The Corrib gas field is interpreted as a salt-cored anticline in the 
Triassic Corrib Sandstone Formation (formerly the Sherwood Sandstone). The gas 
is dry, believed to be sourced from the underlying Carboniferous. Recoverable 
Reserves for Corrib are approximately 1 TCF. 
 
Inishkea prospective resources are tabulated below. 
 
Licence    Prospect      Play                 Gross un-risked prospective 
                                            resources (billion cubic feet) 
 
                                            Low      Best     High     Mean 
 
LO 16/20   Inishkea      Triassic gas       244      968     3,606    1,528 
 
Europa follows Society of Petroleum Engineers (SPE) guidelines for petroleum 
reserves and resources classification. By definition prospective resources are 
recoverable and should not be confused with undiscovered gas initially in place 
('GIIP'), which are not. Further information can be found on the SPE website 
https://bit.ly/2LtLVIa . 
 
Inishkea is a large fault bounded Triassic structure. It lies to the northwest 
of the Corrib gas field and is 11 km from Corrib at its nearest point. The 
reservoir is Triassic age Corrib sandstone sourced from the underlying 
Carboniferous. The trap is provided by a combination of Triassic Uilleann 
Halite top seal and fault seal. Engineering studies demonstrate strong positive 
economics for a range of porosity outcomes, including outcomes significantly 
poorer than Corrib. Europa's view of porosity at Inishkea is supported by 
velocity data from new PSDM data. Given the Company's confidence in trap and 
reservoir quality and the nearby producing Corrib gas field, prospect risk is 
regarded as low based on in-house technical work. A slidepack on the Inishkea 
prospect can be found on Europa's website (https://bit.ly/2SYy3wJ). 
 
There are five other Triassic and Jurassic leads on LO16/20. These are not 
included in the prospect inventory at this moment but may be upgraded to 
prospect status in the future. The Corrib North structure containing the 18/ 
20-7 gas discovery well drilled by Shell in 2010 is included in the prospect 
inventory and may be upgraded to contingent resources pending further 
engineering evaluation. 
 
A gas discovery at Inishkea has the potential for fast track development 
utilising the nearby Corrib gas field facilities. The Corrib field is in 
decline and growing ullage in the gas infrastructure is predicted to become 
available.  A recent report authored by PwC for the Irish Offshore Operators' 
Association - available here https://www.iooa.ie/ 
value-of-the-indigenous-oil-and-gas-industry-to-ireland/ - references rising 
demand for electricity in Ireland over the next 10 years, with a projected 
potential increase of up to 57%. The PwC report also cites rising demand for 
gas, which is forecast to increase 35% by 2030. Inishkea gas has the potential 
to provide a vital component of Ireland's energy mix providing energy security, 
investment, jobs and tax revenues. 
 
A drilling location for a first exploration well on Inishkea (18/20-H) has been 
identified. There is a robust, low risk tie on seismic data for the Corrib 
Sandstone reservoir back to the Corrib gas field. Europa intends to acquire a 
site survey in summer 2019 (subject to regulatory consent), enabling a well to 
be drilled at this location in 2020 (subject to funding and regulatory 
consents). Operations planning for both the site survey and engineering design 
of the exploration is in progress. 
 
As previously announced, the Company is currently negotiating farm-in 
agreements with a major international oil and gas company ('the Major') in 
respect of LO 16/20, FEL 1/17 and FEL 3/13. The Company has agreed terms with 
the Major's NW Europe division and is awaiting a final investment decision from 
their head office. Europa continues to have positive engagement with the Major 
and continues to have positive interest from other potential farminees. Further 
announcements will be made in due course. 
 
Further information regarding Europa's complete Atlantic Ireland prospect 
inventory can be found on its website (https://bit.ly/2GNQAFI). 
 
The information communicated in this announcement contains inside information 
for the purposes of Article 7 of the Market Abuse Regulation (EU) No. 596/2014. 
 
                                 * * ENDS * * 
 
For further information please visit www.europaoil.com or contact: 
 
Hugh Mackay       Europa                        + 44 (0) 20 7224 
                                                3770 
 
Phil Greenhalgh   Europa                        + 44 (0) 20 7224 
                                                3770 
 
Matt Goode        finnCap Ltd                   + 44 (0) 20 7220 
                                                0500 
 
Simon Hicks       finnCap Ltd                   + 44 (0) 20 7220 
                                                0500 
 
Camille Gochez    finnCap Ltd                   + 44 (0) 20 7220 
                                                0500 
 
Frank Buhagiar    St Brides Partners Ltd        + 44 (0) 20 7236 
                                                1177 
 
Susie Geliher     St Brides Partners Ltd        + 44 (0) 20 7236 
                                                1177 
 
Notes 
 
Europa Oil & Gas (Holdings) plc has a diversified portfolio of multi-stage 
hydrocarbon assets that includes production, exploration and development 
interests, in countries that are politically stable, have transparent licensing 
processes, and offer attractive terms. In 2018 Europa produced 94 boepd. Its 
highly prospective exploration projects include the Wressle development in the 
UK (targeting production start-up in 2019 at 500 bopd gross) and six licences 
offshore Ireland with the potential to host gross mean un-risked prospective 
resources of 6.4 billion barrels oil equivalent and 1.5 tcf gas across all six 
licences. 
 
 
 
END 
 

(END) Dow Jones Newswires

February 26, 2019 02:00 ET (07:00 GMT)