Europa Oil & Gas (Holdings) plc / Index: AIM / Epic: EOG / Sector: Oil & Gas
22 August 2016
Europa Oil & Gas (Holdings) plc ('Europa' or 'the Company')
Technical Update on Licensing Option 16/22, Offshore Ireland
Europa Oil & Gas (Holdings) plc, the AIM listed oil and gas exploration,
development and production company focused on Europe, is pleased to provide
detailed technical information on the recently awarded Licensing Option ('LO')
16/22. Europa has a 100% interest in, and is operator of, seven licences in
the Atlantic basins offshore Ireland including LO 16/22, which covers 992km2 in
the Padraig Basin.
Highlights
* Gross mean un-risked indicative resources in the range of 300-600 million
barrels of oil equivalent
* Padraig Basin is a remnant Jurassic basin on the eastern margin of the
Rockall Trough
* Most relevant analogue is the conjugate margin play offshore Newfoundland
in the Flemish Pass Basin
* Good quality 1998 2-D seismic suggests structures of significant size
* Multiple leads mapped in water depths ranging from 800-2,000m in both
Pre-rift and Syn-rift hydrocarbon plays
* Strategy to expedite exploration by securing a farm-in partner with which
to reprocess historic 2-D seismic over LO 16/22 and to mature leads to
drillable prospect status
Europa CEO Hugh Mackay said, "Following Statoil's exploration success at the
play-opening Bay du Nord oil discovery in the Flemish Pass basin offshore
Newfoundland there is considerable industry interest in Flemish Pass analogues
being found offshore west Ireland. Whilst most of the industry is currently
focused on exploring for this play in the South Porcupine basin our restoration
of the conjugate margin prior to Atlantic seafloor spreading suggests the
possibility that the Padraig basin may be a better fit with the Flemish Pass
basin.
"The potential of the Flemish Pass play in Ireland is currently being pioneered
in the South Porcupine basin by the oil majors. If they achieve exploration
success we expect there will be clear technical read across to, and potentially
de-risking of, our Padraig licence and in due course this might encourage a
second phase of drilling in the perched basins on the Rockall margin. Whilst
the Padraig Basin play is currently at an early exploration stage and at the
higher risk end of the exploration spectrum, we have a work programme to
de-risk this evolving play. In particular we are hopeful that successful
reprocessing of historic 2-D seismic might allow us to mature existing leads to
drillable prospect status at comparatively low cost and without the necessity
to acquire new seismic data."
A map can be found on Europa's website detailing the location of all seven of
Europa's offshore Ireland licences. Please click on the link below or copy and
paste this into your browser: http://www.europaoil.com/documents/
160607EuropaIrishLicences_002.pdf.
An updated concession map can be found on the Department of Communications,
Climate Action and Environment (DCCAE) website at: http://www.dccae.gov.ie/
natural-resources/SiteCollectionDocuments/
Oil-and-Gas-Exploration-and-Production/A0_Concession_Map_Jul2016.pdf.
Further Information
LO 16/22 was awarded to Europa as part of Phase 2 of the 2015 Atlantic Margin
Licensing Round (see announcements of 3 June and 8 June 2016).
The duration of LO 16/22 is three years, effective from 1 June 2016. Following
the completion of a work programme, Europa has the option to apply to the Irish
authorities for their consent to convert the LO into a full Frontier
Exploration Licence ('FEL').
During the period of the Licensing Option Europa will further mature the
prospect inventory and will seek a farm-in partner with which to convert to an
FEL, reprocess a 2-D seismic survey and in due course drill an exploration well
(subject to a positive technical and commercial outcome from the 2-D seismic
reprocessing, prospect mapping and prospect inventory).
The licence lies on the eastern margin of the Rockall basin. It contains a
number of exploration leads in water depths of 800-2,000m. The licence is some
300km west of the Irish coast and some 150km to the west of the Spanish Point
and Burren discoveries. Whilst the location offers some logistical challenges
these are considered no more difficult than the western flank of the South
Porcupine basin where substantial exploration activity is already taking place.
The Pre-rift oil play comprises Lower and Middle Jurassic sandstone reservoirs
in large tilted fault block structures with Jurassic source rocks. It is also
possible that the Triassic gas play could be developed, however, oil would be
the preferred hydrocarbon type in this location.
The Syn-rift play comprises Upper Jurassic source rocks that provide the
pre-eminent source rock around the North Atlantic hydrocarbon province commonly
charging both Pre-rift reservoirs and Upper Jurassic shallow marine, fan, and
slope apron sandstone reservoirs. Traps are tilted fault blocks.
There are a number of relevant historic 2-D seismic surveys available over the
licence. The most important data set was shot for Phillips Petroleum in 1998.
These data are of good intrinsic quality and would, the Company believes,
respond well to modern reprocessing. It is hoped that a successful outcome to
seismic reprocessing of the 2-D data could mature leads to drillable prospect
status without the necessity for acquisition of new seismic data.
In due course Europa will seek a farm-in partner with which to reprocess
seismic, mature leads to drillable prospect status and, if justified, drill a
Padraig basin exploration well. The immediate priority is to farm-out Europa's
South Porcupine licences FELs 2/13 and 3/13 and LOs 16/2 and 16/19.
Flemish Pass Basin
The Flemish Pass basin is located in the Atlantic Ocean some 400km east of St
John's in Newfoundland, Canada. It is adjacent to the Jeanne d'Arc basin which
hosts oil production from the Hibernia, White Rose and Hebron fields in shallow
water depths. Water depths in the Flemish Pass basin range from 500-1,500m and
environmental conditions are considered harsh. The Flemish Pass play comprises
Syn-rift Jurassic sandstone reservoirs in structural traps with closely
associated contemporaneous source rocks.
Whilst exploration drilling has been conducted in the basin since the 1980s it
was not until Statoil's Bay du Nord oil discovery in 2013 that exploration
activity substantially increased. In 2013 Bay du Nord was reported as
potentially holding resources of 300-600 million barrels of oil equivalent and
was considered to be the largest exploration discovery in the world that year.
This exploration success stimulated further exploration activity. Statoil
undertook a nine well drilling campaign including exploration and appraisal
drilling. Two new discoveries were made at Bay du Verde and Baccalieu and it
was reported that the volumes at Bay du Nord were within the original volume
estimate of 300-600 million boe but potentially toward the lower end of the
range. During 2015 new exploration licences were awarded to mostly major and
super-majors including Statoil, Exxon, Chevron, BP, BG and Nexen. Work
programmes to the value of C$1.9 billion were committed to and including cash
payments of C$450 million. Some of these companies have also recently been
awarded licences in the South Porcupine Basin in Ireland and it seems
reasonable to assume that their technical insights from Flemish Pass may have
influenced their applications in Ireland.
Prior to seafloor spreading and the creation of the North Atlantic, Ireland and
Canada were joined together and formed part of the same conjugate margin. As
the North Atlantic began to spread open, various sedimentary basins were
created and into which were deposited sandstones reservoirs and mudstone source
rocks. In some of the basins such as Flemish Pass the combination of
reservoir, source and trap has been found by exploration drilling in the right
circumstances to deliver potentially commercial hydrocarbon discoveries. In
other basins such as the South Porcupine whilst the "ingredients" of reservoir,
trap and source are known to exist individually the lack of exploration
drilling means than they have not yet been found combined in a potentially
commercial discovery, were these to exist.
Atlantic basin portfolio
Europa has seven licences in three basins in the Atlantic basins offshore
Ireland. The combined gross mean un-risked prospective and indicative
resources of more than 4 billion boe and 1.5 TCF gas.
gross mean un-risked
prospective and indicative
resources
Licence Europa area km2 Basin Term Oil millon Gas TCF
equity boe
FEL 2/13 100% 768 South Phase 595
operator Porcupine 1 of
15 yr
FEL 3/13 100% 782 South Phase 1,500
operator Porcupine 1 of
15 yr
LO 16/2 100% 523 South 2 yr 895
operator Porcupine
LO 16/19 100% 976 South 2 yr 700
operator Porcupine
LO 16/20 100% 945 Slyne 3 yr 1
operator Basin
LO 16/21 100% 832 Slyne 3 yr 0.5
operator Basin
LO 16/22 100% 992 Padraig 3 yr 500
operator
total 5,818 4,190 1.5
* * ENDS * *
For further information please visit http://www.europaoil.com/ or contact:
Hugh Mackay Europa + 44 (0) 20 7224
3770
Phil Europa + 44 (0) 20 7224
Greenhalgh 3770
Matt Goode finnCap Ltd + 44 (0) 20 7220
0500
Simon Hicks finnCap Ltd + 44 (0) 20 7220
0500
Frank St Brides Partners + 44 (0) 20 7236
Buhagiar Ltd 1177
Susie St Brides Partners + 44 (0) 20 7236
Geliher Ltd 1177
Notes
Europa Oil & Gas (Holdings) plc has a diversified portfolio of multi-stage
hydrocarbon assets that includes production, exploration and development
interests, in countries that are politically stable, have transparent licensing
processes, and offer attractive terms. In 2015 Europa produced 141 boepd. Its
highly prospective exploration projects include the Wressle development
(targeting production start-up in H2 2016 at up to 500 bopd gross) in the UK;
100% owned gas exploration prospect (107 bcf) and appraisal project (CPR 277
bcf) in onshore France, a joint venture with Vermilion Energy also in onshore
France; and seven licences offshore Ireland with the potential to host gross
mean un-risked prospective and indicative resources of more than 4 billion
barrels oil equivalent and 1.5 tcf gas across all seven licences.
Qualified Person Review
This release has been reviewed by Hugh Mackay, Chief Executive of Europa, who
is a petroleum geologist with 30 years' experience in petroleum exploration and
a member of the Petroleum Exploration Society of Great Britain, American
Association of Petroleum Geologists and Fellow of the Geological Society. Mr
Mackay has consented to the inclusion of the technical information in this
release in the form and context in which it appears.