Prospex Cleared to Enter Spanish Gas Power Project
London-listed Prospex Energy has been cleared by regulators to take a 49.9% stake in El Romeral, an integrated gas production and power station project in southern Spain, it said on December 24.
The company has secured approvals from both ministerial and regional authorities for the deal, first announced a year ago. El Romeral comprises three licence areas hosting three wells that supply gas to a 8.1-MW power station. There is also "significant" development potential, according to Prospex, with the acreage containing two development locations and 11 very-low risk prospects with gross contingent and prospective gas resources of 5bn ft3 and 90bn ft3 respectively.
Prospex is acquiring the position at El Romeral through its 49.9%-owned Tarba Energia subsidiary, whose other shareholder is Australia's Warrego Energy. Once the deal is closed, Tarba will assume day-to-day management and control of the project and look to implement a number of short-term operational enhancements and efficiencies.
There is no committed work programme, but Tarba's medium-term goal is to raise gas production and in turn output at the power station towards its nameplate capacity, by drilling new wells at already-identified development locations and prospects. It will also review the existing wells to see if workovers can enhance recovery rates.
Prospex also said it had issued a £416,000 ($565mn) convertible loan note and associated warrants to new and some existing investors, as well as some board members and staff, to settle stipends and salaries that were deferred because of the Covid-19 pandemic.