Last checked at 9 Sep 2008 07:00
Independent Resources plc ("IRG" or the "Company")
Update re Fiume Bruna
Government approval for testing on Italy's first coalbed methane project
September 9th, 2008: The Company is pleased to announce that the Italian Government has approved plans for production testing at the IRG-operated Fiume Bruna coalbed methane (CBM) project near the north-west coast, which is Italy's first CBM project.
The approval clears the way for IRG to start drilling within an agreed area and to acquire new seismic data. The seismic acquisition work is due to start within the next few weeks, ahead of drilling the first well and putting it on a long-term production test.
Results from earlier seismic and appraisal work, including the drilling and coring of a stratigraphic borehole late in 2006, have produced an in-place resource estimate for Fiume Bruna of 170 billion cubic feet, with a recoverable resource of 92 billion cubic feet.
IRG Executive Chairman Grayson Nash said: "This project promises the development of a potentially very important energy resource in a market where there is a healthy growth in demand for gas and where existing indigenous gas production is falling rapidly."
IRG is working at Fiume Bruna alongside Norwest Questa Engineering, a leading US consultancy group with specialist CBM expertise. The main purpose of the planned production test is to determine gas production and any water flow rates from the coal in place. Rigs and service companies have been short-listed, and negotiations are at an advanced stage to finalise these contracts. A seismic acquisition and processing contractor has already been engaged.
This approval by Italy's Ministry of Economic Development finalises the permitting process of the exploration licence.
For further information contact:
Stephen Staley, Managing Director, Independent Resources plc: 01332 865 253
07771 838 753
Allan Piper, Tavistock Communications: 020 7920 3150
Duncan McCormick, Tavistock Communications: 020 7920 3150
Jonathan Wright, Seymour Pierce Limited 020 7107 8000
David Smith, Deloitte Corporate Finance 020 7007 8177
Background details follow:
Preliminary award of the Fiume Bruna permit was made to Independent Energy Solutions srl (a wholly-owned subsidiary of IRG) in 2005. Since then the Company has drilled the first CBM stratigraphic borehole in Italy and collected representative coal samples from within the body of the coal deposit. These have been subjected to a wide range of state-of-the-art techniques to arrive at the resource estimates and other vital parameters that underlie IRG's understanding of the coal and its CBM potential.
The Fiume Bruna permit covers some 247 km2, a large part of which is underlain by virgin coal. This generally occurs in one 7 metre thick seam and was the object of mining activity for many years until forced abandonment of mining in the 1950s due to the coal's high methane content. The mineworkings only touched one small area of the overall coal deposit leaving the rest as potential CBM-producing areas.
IRG was admitted to AIM in December 2005 and is pursuing an integrated and asset-backed gas trading business in Italy with midstream components in Italy and upstream components within Italy and in North Africa. Along with Fiume Bruna, these include the planned Rivara natural gas storage facility in the Po Valley, and exploration acreage at Ksar Hadada in Tunisia. The Company aims to pursue this long-term strategy in the most environmentally-sustainable way, by whenever possible incorporating from the outset the permanent geological storage of CO2 into its future commodity production and trading. IRG has focused on building a profitable portfolio through wholly-owned initiatives and partnerships.