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2 Jul 2010 07:00
Embargoed for release: 0700 on 2 July 2010
Northern Petroleum Plc ("Northern", "the Group" or "the Company") Preliminary analysis of effects of new Italian environmental proposals
Preliminary examination by the directors of Northern Petroleum Plc (AIM:NOP) suggests that proposals as detailed in a posting on the official Ministry of the Environment web-site, attributed to Environment Minister Stefania Prestigiacomo, do not affect Northern's reported reserves in Italy or the exploration prospectivity of the Southern Adriatic, and has limited or no effect upon most other areas including the West of Sicily Thrust Belt.
The reported initiative to change legislation covers oil activities within five nautical miles of the coastline and hydrocarbon activities within twelve nautical miles of a marine or coastal protected area. The majority of Northern's permit areas are further offshore.
The specifics of the immediate preliminary review, covering the effects upon the Group's activities offshore Italy are outlined below.
Southern Adriatic (2permits, 3 preliminary awardsand 4applications)
The effect is extremely minor in aerial extent and has no effect on established reserves or exploration prospectivity.
West of SicilyThrust Belt (6 permits, 4 preliminary awards and 1 application)
For the six permit area there is a minor aerial effect upon only one of the six blocks, being the eastern part of G.R20.NP. Further study is required before an assurance can be given to shareholders that it has no effect on any prospects being developed.
The proposals could have effect upon a significant part of two of four applications in the area (d21G.R-.NP & d25G.R-.NP). A more detailed examination is required.
Sicily Channel (2 permits,2 preliminaryawardsand 3 applications)
There would be no effect upon permit C.R146.NP and the adjacent application d351C.R-.NP, which contain the very large Vesta prospect.
C.R147.NP, north of Pantelleria Island, would be affected but the initial review concluded that two prospects remain unaffected and only a partial effect applies to three further prospects.
Closer to the coast of Sicily, the Company has four applications. One, d30G.R-.NP, would be entirely unaffected. For another, d358C.R-.EL, on Northern's interpretation it would appear that the area of greatest interest would not be materially affected and in d29G.R-.NP, it appears that sufficient of the structural lead remains unaffected.
It is clear that d347C.R-.NP will require more detailed review before offering comment.
Ionian Sea(3 preliminary awards and 2 applications)
The greatest effect would be to interests in this area. If introduced the new proposals would rule out most of the area of two preliminary awards d59F.R-.NP & d64F.R-.NP, whereas d77F.R-.NP is entirely unaffected and the effects upon d63F.R-.NP and d75F.R-.NP are considered minor. It may be that upon further consideration a reaction to an oil well blow-out and resultant spill should not apply to gas in the same way.
The Directors advise that previous discussions with The Ministry of Industry and Economic Development had mainly concerned an agreement for a 3 nautical mile limitation, which was accommodated and had little or no effect on the Company's operations. There has been no prior consultation with the Ministry of Environment on this initiative.
"I believe we are not badly affected save in the Ionian Sea, not our most significant core area. We have always conducted ourselves with due consideration to marine parks, sensitive coastal areas and the environment in general. It is not surprising that the Italian Government would have some reaction to events in the Gulf of Mexico and now we can move forward with their views having been expressed." commented Derek Musgrove, Managing Director of Northern.
In accordance with the AIM Rules - Guidance for Mining and Oil & Gas Companies, the information contained in this announcement has been reviewed and signed off by the Exploration and Technical Director of Northern, Mr. Graham Heard CGeol. FGS, who has over 35 years experience as a petroleum geologist.
- ENDS -
For further information please contact:
Northern Petroleum Plc Tel: +44 (0) 20 7469 2900 Derek Musgrove, Managing Director Chris Foss, Director of Legal & Corporate Affairs
Graham Heard, Exploration & Technical Director
Cenkos Securities (NOMAD and Joint Broker) Jon Fitzpatrick Tel: +44 (0) 20 7397 8900 Jefferies International (Joint Broker) Tel: +44 (0) 20 7029 8000
Chris Snoxall Financial Dynamics Tel: +44 (0) 20 7831 3113
Billy Clegg / Edward Westropp
Bishopsgate Communications Tel: +44 (0) 20 7562 3350
Nick Rome / Michael Kinirons
Notes to Editors:About Northern
Northern Petroleum Plc is an independent oil and gas Exploration Company listed on the AIM market in London focused on the European Union and nearby areas.
Comprehensive information on Northern and its oil and gas operations, including all press releases, annual reports and interim reports are available from Northern's website at www.northpet.com.
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