with last few posts. I read a lot and comment very little, but it amazes me how some people expect overnight positive progressions within companies. In terms of exploration this company is a lower risk/return than many in my opinion. And if EOG come good then the returns could be far higher than other companies that keep getting mentioned. Again chill out or get out.
Finally, with regards to shale gas, I am pasting a couple of paragraphs taken from the shareholder newsletter issued in February of this year which you may have missed and should hopefully clarify Europa's position on this:
"As a holder of several onshore licences, we have been closely following developments surrounding shale gas in the UK. Recent Government initiatives together with recent farm-ins by Total and Centrica promise to kick-start the industry in the UK. There has been much speculation in the press that our 50% owned PEDL 181 licence is prospective for shale gas and I will take this opportunity to explain the situation. Kiln Lane is a conventional oil exploration well targeting a conventional oil prospect typical of the East Midlands Petroleum Province with oil trapped in Carboniferous age sandstone reservoirs; an example of which can be found 25 km to the west at our Crosby Warren field. Kiln Lane is not a shale gas well and therefore is not being permitted or planned as a shale gas well.
"Despite the long history of drilling in the East Midlands, PEDL 181 has never been drilled and the presence of source rocks is not proven. As a result, in addition to evaluating a conventional oil and gas prospect, the Kiln Lane well will also serve as an important stratigraphic test, providing new information on all aspects of the petroleum system in the South Humber basin, including trap, reservoir and source rocks. Should the Kiln Lane well prove the existence of what would be a new and previously undrilled source rock sequence, then this will provide a valuable insight into both the conventional and unconventional hydrocarbon potential of the licence. The presence of source rocks does not automatically equate to a shale gas play, but it is a good start. In the event the shale gas prospectivity is real then we have a strong acreage position and we would evaluate the potential using a drillsite and well that have been specifically planned, constructed and permitted for shale gas. As stated previously we may seek to do so alongside an appropriate partner."
I hope this clarifies matters for you. In short, with two UK onshore wells to be drilled between now and the end of 2014 and a new prospect inventory for the Irish licences expected in the summer there should be no shortage of exciting news flow over the next few months.
Thank you for your email addressed to the Company.
As detailed at the time of the placing and open offer, the £4m raised was earmarked to drill an exploration well at Kiln Lane, PEDL-181, onshore East Midlands, UK; furthering its work in Ireland, both in respect of the Company’s existing interests in two exciting exploration licences, and participating in the next licence round; farm-out costs and initial well planning at the Berenx Shallow prospect, onshore France.
As reported in the recent Interims in April, work is progressing in all three areas. Specifically, a twelve month extension for the licence for PEDL 181 has been secured, well permitting and planning for Kiln Lane is underway and Zenith Energy were appointed to provide well management services for the project. Europa is on course to drill Kiln Lane in Q4 2014 but as I am sure you will appreciate there are procedures that need to be followed before drilling can commence.
In Ireland excellent progress has and continues to be made. Just to recap and as reported in the interims, 'in October 2013 we announced the completion of a 1,500km2 3-D seismic acquisition over our two licences in the South Porcupine Basin, offshore Ireland.... In the next few weeks we expect to receive the processed data set for the seismic. Alongside Kosmos, we will immediately set about interpreting and mapping the data with a view to clarifying the prospectivity of the two blocks on which Europa previously mapped billion barrel prospects using historic 2-D data. This state of the art 3-D seismic is likely to change the volumetrics of our prospects and also markedly de-risk the assets. A decision to drill on one or both of the licences is expected in the summer of 2014 and we understand that Kosmos may elect to drill a well as early as 2015.' The processed data off Ireland has been received and interpretation is in progress by both the Company and Kosmos. The fast track project is hitting all targets and is on schedule.
In France a data room has been opened to secure a farm-in partner for the Béarn des Gaves Permit, located in the proven Aquitaine Basin with whom Europa will look to drill the Berenx Shallow gas prospect. Talks are on-going with interested parties but it would be inappropriate to provide a running commentary until definitive progress has been made. To ensure Europa is in a position to drill a well at the earliest opportunity well planning and permitting is being advanced.
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