San Leon granted approval for Durres offshore licence

TIRANA, Feb. 7 – San Leon has announced that the Albanian government has approved the Durresi Block Licence Petroleum Complimentary Agreement for San Leon and its partner, Beach Energy Limited (“Beach Energy”). San Leon, through a subsidiary, holds a 75% interest in the block and is the operator. Beach Energy holds the remaining 25% interest. The approval became effective when the decision was published in the Albanian government’s official gazette.
The Durresi Block, offshore Albania, is situated along the highly prospective Apulian Margin. With the approval of Durresi now gained, San Leon will focus on acquiring over 300 km2 of 3D seismic data during the remainder of Q1 2011.
The 3D seismic programme will evaluate the A4-1X discovery as well as prepare for a 2012 appraisal drilling programme in the undeveloped gas condensate field. Beach Energy has also agreed to pay 50% of the costs, rather than their 25% working interest requirement, for the upcoming 3D seismic programme in exchange for an option which, if exercised, will allow them to hold a 50% working interest in the licence going forward.
The A4-1X field was discovered in 1983, 30 km off the southern coast of Albania. The discovery indicated circa 38 mmbbls of circa 51 API condensate and 150 BCF of gas. The Company is also exploring significant potential multiple plays adjacent to A4-1X targeting both oil and gas. This underexplored, highly prospective, area is situated on the proven Apulian Margin, which extends from Italy into Albania. Southern Albania contains a highly prolific petroleum system including one of the largest onshore oil accumulations in Europe, the Patos-Marinza field, which is estimated to contain up to 5.7 billion barrels of OOIP.
OisFanning, Executive Chairman of San Leon Energy, commented:
“This project is the catalyst for our Albania exploration programme. We are excited to have received Council of Ministers’ approval and can now focus on our upcoming 3D seismic programme. We see great potential in Albania, and are confident of a successful outcome in the upcoming evaluation and appraisal of the A4-1X discovery. Albania is quickly gaining momentum in our portfolio as our subsurface team continues to develop an inventory of exploration opportunities.”