Portugal: Porto Energy Secures Additional Concessions
Porto Energy Corp. has secured two new onshore natural gas concessions in in Portugal.
Porto Energy acquired a 100% working interest in the Zambujal and Peniche concessions, which cover 315,000 and 96,000 acres respectively. This brings the company’s working interest in Portugal to more than 1.9 million net acres. The terms of the initial exploration period are for eight years.
Both concessions are being evaluated by the Porto Energy, Sorgenia, RAG joint venture agreement, which was signed early March, as an unconventional oil and gas resource.
In addition to its new concessions, Porto Energy also announced approval of a modified 2012 work program. Consent was given by the Portuguese oil and gas authority, Divisão para a Pesquisa e Exploração de Petróleo. The Company finished approximately 82% of its 2011 work program. However, following the drilling results in the reef wells as well as the ALJ-4 re-entry well, and based on the timing of the interpretation of the recently completed Montejunto 3-D seismic data acquisition, the Company and DPEP agreed to modify the Porto work program commitments going forward, with a near term focus on the evaluation of the Lias stratigraphic interval, which Porto has identified as an unconventional resource throughout its concessions.
Under the 2012 work program, the Company will drill 19 shallow wells testing the Lias and two additional deep wells targeting the pre-salt and possibly the Aljubarrota gas discovery. All 19 Lias wells are being undertaken as part of the JV with Sorgenia/RAG, for which they will carry Porto. The two deep wells include a pre-salt well, the Alcobaca #1 and, depending on the results of that initial well, the Alj-5 well to further evaluate the Aljubarrota gas discovery.
The total cost for these wells is expected to be approximately US$14.0 million and are anticipated being funded, in part, by joint venturing efforts. Receipt of the approval from the DPEP ensures that Porto will remain in good standing with the government and will be able to meet its obligations under the concession agreements.
"We have consolidated a significant and attractive land position in central Portugal with a focus on a range of play types," said Joseph Ash, President and CEO of Porto Energy Corp. "We continue to work closely with the Portuguese government and this new program will allow us to focus on the Lias unconventional play as well as finalize our JV partner negotiations in the near term which, if concluded successfully, will provide working capital to drill a pre-salt well. In addition we continue to evaluate a series of JV opportunities that will ultimately allow us to further unlock the asset value of our emerging pre-salt play as well as other play types."