Po Valley Energy (ASX: PVE) is a leading independent Oil and Gas enterprise that currently operates exclusively in northern Italy exploiting the large hydrocarbon system, and it is now a gas producer in the fast-growing Italian market.
All of the Po Valley Energy's fields are in very close proximity to the pipeline grid and major consumers in the north of Italy.
Po Valley Energy nails maiden profit in turnaround from gas production
Italian oil and gas producer and explorer Po Valley Energy (ASX: PVE) has achieved a sizeable feat delivering a maiden half year net profit of A$0.5 million (€367,010) - powered by increased production and revenues from its gas fields in Northern Italy.
Key metrics for the half year:
Revenue: €4.35 million (AUD 5.9m), previously €2.59 million (AUD 3.5m)
EBITDA: €2.26m (AUD 3.0m)
Net profit: €0.37 million (AUD 0.5m)
Cash and cash equivalents: €1.6m (AUD 2.2m), previously €1.0m (AUD 1.3m)
The Vitalba development well is on schedule, and the Sillaro gas field reserves have been confirmed.
The company has initiated a search for farm-out partners for a selected number of the company's assets, and has appointed Moyes & Co. as a global energy advisor.
Giovanni Catalano, chief executive officer, commented "In addition to the significant increase in production revenues, our exploration and development programs are also progressing.
"We start drilling our Vitalba-1dirA well in coming weeks and, if successful, we plan to restart production from the Castello before year-end to further boost revenue growth and cash flow in 2012."
Operating Review
During the half year, Po Valley had production from both the company's Castello and Sillaro gas fields and produced a total of 15.5 million cubic metres of gas.
Production continues from the Castello well at a low rate ahead of drilling the new Vitalba-1dirA well.
The planned Vitalba-1dirA well will be deviated from the current Castello plant location and connected to the existing Castello production plant.
The company said subject to drilling success, production is planned to increase in the second half of 2011.
The development plan was modified to incorporate the new well and submitted to the responsible Italian regulatory authorities, with the final authorisation issued in the 1st Quarter of 2011.
In the interim, Vitalba- 1 dir has been operating at limited rates and is currently producing at approximately 3,000 cubic metres per day.
Production from Castello during the half year amounted to 563 thousand cubic metres.
Sillaro produced 14.9 million cubic meters during the first six months of 2011 averaging approximately 83,000 cubic metres per day in accordance with the contracted gas rates for the 2010 – 2011 Gas Thermal Year.
As planned, Sillaro production was stopped for 3 days to record bottom hole pressure readings.
The results are encouraging with confirmation of the previously estimated reserves if not slightly higher.
Po Valley now plans to wait for the next run of pressure readings in about a year’s time before reviewing the reserve estimates.
