Petroceltic International raising £81m for appraisal work in Algeria and Italy

Petroceltic International (AIM: PCI) said it has conditionally raised £81m through the placing of approximately 635m new shares at 12.75p each. The proceeds will be used to support the company’s appraisal programme in Algeria and also fund drilling in Italy.

"Petroceltic is embarking on a six well drilling programme in the second half of 2010 across all areas of operations, with appraisal wells in Italy and Algeria, and exploration wells onshore Tunisia”, Petroceltic chief rxecutive Brian O'Cathain commented. 

“This placing will fund the appraisal programme to optimise development plans for our major discoveries on the Isarene permit in Algeria.  It also facilitates the drilling of a further well to determine the quality and extent of the oil discovery on the Elsa field in the Adriatic offshore Italy”.

The company noted that the placing was well supported and oversubscribed. The company’s brokers Mirabaud Securities and J E Davy carried out the placing to both existing and new investors. The new shares are expected to begin trading on London’s AIM market and the Irish Stock Exchange by 23 April, subject to a shareholder vote at a general meeting on the 21 April.

In Algeria, Petroceltic plans to begin an appraisal programme, consisting of three wells, on its Isarene Permit in the fourth quarter of 2010. The appraisal programme’s focus will be to determine the most likely recovery factors in respect of the previous discoveries of hydrocarbon resources on the permit. The programme is expected to enable the optimisation of development plans for Isarene.

Previously in February 2010, the company completed a highly successful five well appraisal drilling programme with four of the five wells drilled successfully testing at commercial gas flow rates, ranging from 4mmscfd (million standard cubic feet per day) to 33mmscfd.

Data gathered from the previous appraisal drilling suggests the presence of an extensive and continuous gas accumulation, Petroceltic said.

Isarene is being developed through a joint venture with and the Algerian oil & gas company Sonatrach. With a 75% working interest and 100% of the paying interest, Petroceltic is the primary stakeholder and operator of the permit. Sonatrach owns the remaining 25%.

In Italy, the company plans to appraise the Elsa discovery. In 1992 the Elsa-1 well logged a 65m oil column, and the proposed appraisal programme plans to drill and test the Elsa-2 well adjacent to the discovery. According to Petroceltic, independent reports

The company plans to appraise the Elsa discovery well in Italy by drilling and testing an Elsa-2 well adjacent to Elsa-1. reports on Elsa have attributed gross contingent recoverable resource up to 170 mmbbls (million barrels).

An environmental impact assessment for Elsa-2 was submitted to the Italian Ministry for the Environment in August 2009 and it is expected to be approved in the second quarter of 2010. Subsequently, drilling operations are planned to commence in September 2010.

Petroceltic holds a 70% working interest in the B.R268.RG licence area, which hosts the Elsa field.Petroceltic International (AIM: PCI) said it has conditionally raised £81m through the placing of approximately 635m new shares at 12.75p each. The proceeds will be used to support the company’s appraisal programme in Algeria and also fund drilling in Italy.

"Petroceltic is embarking on a six well drilling programme in the second half of 2010 across all areas of operations, with appraisal wells in Italy and Algeria, and exploration wells onshore Tunisia”, Petroceltic chief rxecutive Brian O'Cathain commented. 

“This placing will fund the appraisal programme to optimise development plans for our major discoveries on the Isarene permit in Algeria.  It also facilitates the drilling of a further well to determine the quality and extent of the oil discovery on the Elsa field in the Adriatic offshore Italy”.

The company noted that the placing was well supported and oversubscribed. The company’s brokers Mirabaud Securities and J E Davy carried out the placing to both existing and new investors. The new shares are expected to begin trading on London’s AIM market and the Irish Stock Exchange by 23 April, subject to a shareholder vote at a general meeting on the 21 April.

In Algeria, Petroceltic plans to begin an appraisal programme, consisting of three wells, on its Isarene Permit in the fourth quarter of 2010. The appraisal programme’s focus will be to determine the most likely recovery factors in respect of the previous discoveries of hydrocarbon resources on the permit. The programme is expected to enable the optimisation of development plans for Isarene.

Previously in February 2010, the company completed a highly successful five well appraisal drilling programme with four of the five wells drilled successfully testing at commercial gas flow rates, ranging from 4mmscfd (million standard cubic feet per day) to 33mmscfd.

Data gathered from the previous appraisal drilling suggests the presence of an extensive and continuous gas accumulation, Petroceltic said.

Isarene is being developed through a joint venture with and the Algerian oil & gas company Sonatrach. With a 75% working interest and 100% of the paying interest, Petroceltic is the primary stakeholder and operator of the permit. Sonatrach owns the remaining 25%.

In Italy, the company plans to appraise the Elsa discovery. In 1992 the Elsa-1 well logged a 65m oil column, and the proposed appraisal programme plans to drill and test the Elsa-2 well adjacent to the discovery. According to Petroceltic, independent reports

The company plans to appraise the Elsa discovery well in Italy by drilling and testing an Elsa-2 well adjacent to Elsa-1. reports on Elsa have attributed gross contingent recoverable resource up to 170 mmbbls (million barrels).

An environmental impact assessment for Elsa-2 was submitted to the Italian Ministry for the Environment in August 2009 and it is expected to be approved in the second quarter of 2010. Subsequently, drilling operations are planned to commence in September 2010.

Petroceltic holds a 70% working interest in the B.R268.RG licence area, which hosts the Elsa field.

http://www.proactiveinvestors.com.au/companies/news/6050/petroceltic-international-raising-81m-for-appraisal-work-in-algeria-and-italy-6050.html