Aurelian probes Polish prospects
Article Date: Feb 08 2008East Europe-focused Aurelian Oil & Gas has begun a three-dimension seismic survey of Poland’s promising Siekerki trend.
The AIM-quoted company suggests its licences in central Poland’s Poznan East block could hold reserves on a similar scale to the region’s producing Radlin field, which holds at least 400 billion cubic feet of gas. Michael Seymour, London-based Aurelian’s experienced managing director, argues modern techniques unavailable to Soviet-era prospectors should release the potential in Poznan’s Siekerki field, where a ‘significant gas-bearing structure’ has been identified through vertical drilling at the Trzek-1 well.
The company found a 90-metre gas column there last year, but could flow only two million cubic feet a day. Seymour argues the seismic survey should enable Aurelian to start production and horizontal drilling in September 2009 for production of '10 million to 20 million cubic feet a day’.
If all goes well, he says a formal reserve estimate would follow, enabling the company to set about funding full-scale production to generate ‘substantial revenues’ by 2010/11. Aurelian reckons the cost would be in the region of £220 million, but contends cash flow from the project would limit its own exposure to a maximum £66.5 million and says it will consider various financing options, including a joint venture.
Poland is in the process of liberalising its gas prices under European Union rules. The aggressive tactics of Russia’s Gazprom are making East European countries encourage the search for alternative sources.
Shares in Aurelian, which is already producing a modest daily two million cubic feet of from Romania and has prospects in Bulgaria and elsewhere in the region, have fallen from 2006’s 50p float price tyo 29.25p. If present efforts bear fruit next year, they could repay a recovery punt.
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