San Leon today announced it is hosting a data room for a number of parties, including major multi-nationals, interested in farming-in to its Durresi Block, offshore Albania, that contains the Alban Structure and where the Company holds a 100% operated interest.
The data room timetable has been extended to allow further time for more detailed technical evaluation by interested parties and to accommodate new entrants into the data room.
San Leon internal management estimates for the Alban Structure indicate it contains prospective resources of approximately 3.2 TCF of gas and 145 mmbbls of gas condensate in the mean case. Estimates for the identified prospects and leads on the Durresi Block indicate it contains prospective resources totalling up to two billion barrels of oil equivalent of un-risked mean case recoverable prospective resources. A reservoir engineering study is currently being undertaken with an objective of an exploration well being targeted in 2014.
Following the acquisition of 840 square kilometres of 3D data on the Duresi Block in 2011, the Company initiated a Pre-Stack Depth Migration (PSDM) of the data in March 2012. The PSDM was completed in September 2012. The Alban Structure contains strong seismic indications while the stratigraphic equivalent of the reservoir target has been penetrated by the A3-1X exploration well that is located close to the centre of the Alban Structure. The A3-1X exploration well was drilled in 1994 and found 55% sand/shale ratio in the pre-evaporitic Upper Miocene section.
Strong amplitude anomalies on the Alban Structure show at least three sand sections with 110 – 155 metres of thickness separated by thick shale zones (approximately 50 to 110 metres thick). Strong mud gas shows appeared in nearby similar sections during the drilling of the A3-1X well. The strong seismic responses are all constrained by faults. A significant velocity push-down effect is also associated with the core of the structure, and the velocity anomaly correlates well with the amplitude anomaly. Significantly, neither the amplitude anomalies nor the velocity anomaly are present at the A3-1X well.
The Company continues to carry out further re-interpretation and AVO (amplitude versus offset) analysis of the data on the Alban Structure and the other multiple prospects and leads on the Durresi Block.
The Durresi Block is located on the proven Apulian Margin, on trend with a number of Tertiary gas and Mesozoic/Tertiary oil discoveries in the Italian Adriatic to the northwest, while the Patos-Marinza field, which is estimated to contain up to 7.7 billion barrels of OOIP, is located to the south east. The Alban Structure is located in 150 metres water depth with reservoir target range being between 1,500 metres to 2,500 metres.
There are a number of project development options to Italy and Albania and sensitivity analysis confirms robust project economics. Multiple regional pipeline projects are planned for the South East Europe area, including the Trans Adriatic Pipeline, which is planned to run through the Durresi Block.
Executive Chairman, Oisin Fanning commented:
“This licence has exceptional potential and the continued interest from parties is very encouraging. We have decided to extend the process to accommodate data room attendees. The PSDM and AVO analysis has been an integral part of this process and due to the time consuming nature of this on-going work, the whole process from 3D acquisition to farm-out execution is taking longer than anticipated. However, with existing interested parties seeking further data and new entrants requesting access to the data room, the best way to maximise value for our shareholders is to extend the farm-out process.”
February 7, 2013