Share Talk spoke with Michael Masterman, CEO of Saffron Energy today. We look into the company receiving the final approval from the Italian Ministry of Economic Development (UNMIG) for gas production at the Bezzecca gas field on 11 April 2017. Commissioning and gas production will commence in the coming days.
Bezzecca is located east of Milan within the established prolific, gas-producing Po Valley region in northern Italy and operated by Saffron’s subsidiary Northsun Italia SPA (NSI). Gas from Bezzecca 1 is processed at the Vitalba processing plant and directly connected by the national grid.
Chief Executive Officer of Saffron Energy, Michael Masterman commented:
“We are extremely excited to be announcing first gas at Bezzecca as it represents a significant commercial and financial milestone for Saffron coming within 7 weeks of the successful IPO. It will significantly increase the overall Saffron gas production and strengthen our position and portfolio.”
Company overview:
Sillaro:
• 100% ownership via Saffron’s wholly owned Italian subsidiary, NSI.
• Production licence located in the Emilia Romagna region, 30 km east of Bologna, in northern Italy.
• Production began in May 2010 from 2 wells. Total production of approximately 11,500 standard cubic metres per day (“scmpd”) (c. 300 – 400 million cubic feet of gas per day (“mmcfpd”)) in Q4 2016.
Bezzecca:
• 90% ownership via Saffron’s wholly owned Italian subsidiary, NSI.
• Production licence located 35 km east of Milan, in northern Italy, within the Cascino Castello Production Licence.
• Final preparations to bring the Bezzecca-1 well into production are on schedule for March completion and first gas sales.
• Gas from the Bezzecca field will be processed at the Vitalba processing plant located only 7 km away and will be ready to be connected through the newly constructed tie-in pipeline.
• The development plan includes a second production well which will be drilled in due course. Gas from Bezzecca 2 will also be processed through the Vitalba processing plant.
• Current plans in place are to drill 2 development wells, one in late 2018 and the second in late 2020 in order to fully exploit the proven and probable reserves on the field at a cost of approximately €4.0m per well.
San’ Alberto:
· 100% ownership via Saffron’s wholly owned Italian subsidiary, NSI.
· Located in the Emilia Romagna region of northern Italy.
· Application for a full production concession for Sant’Alberto is expected to be fully granted during the first half of 2017.
· Production well is in place and gas processing facilities and a tie into the Italian National Grid is scheduled for the second half of 2017. Expected cost of €1.3m to complete a modular plant to treat gas production from the existing production well.
The Company anticipates that combined production from the three fields could reach 4,000 mcfpd by 2019, equivalent to almost 700 barrels of oil equivalent per day (“boepd”).
