Prospex Energy (PXEN) , an investor in European gas and power projects, issued an update on its El Romeral production concessions in Spain, containing the El Romeral gas facility and power plant. Prospex has a 49% interest in El Romeral through its investment in Tarba Energia.
El Romeral is currently operating at 30% capacity (2.7 MW) from its 3 natural gas wells, as Tarba waits on permits to drill 5 further infill wells on the concessions to increase production. Today, Prospex confirmed that Spain's environmental ministry has initiated statutory Environmental Impact Assessment (EIA) consultation for the new wells, advancing the regulatory approval process along.
Last year, Tarba was granted a 10-year extension to the El Romeral concessions until July 2034. The planned wells will target 5 optimum structures on the concessions, which will produce biogenic gas from shallow subsurface horizons. The wells will average c. 700m in depth, and should each take 3-4 weeks to drill once a rig has been mobilised.
While Tarba waits for regulatory approvals to complete, it will advance drilling preparatory work, including well design, sourcing of essential long-lead items, and securing necessary contractors to deliver the 5 production wells.
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Propsex announces a key step in the approval process of its 5 planned natural gas wells on the El Romeral concessions in southern Spain. Only 2 of the 5 wells are needed for the El Romeral power plant to reach its full 8.2 MW capacity (currently at 30%). Any extra gas from the remaining new wells or any future wells will support expansion plans at the power plant, as well as direct natural gas export to the grid.
Tarba Energia initially submitted the EIA to Spain's environmental ministry in May 2024. The ministry has now initiated EIA consultation, having sent the EIA and supporting documents to the regional government in Seville and a list of 29 stakeholders. The period of consultation will commence after the application is publicly gazetted, which is expected in the next few weeks. Consultation will be open for 30 working days, during which Tarba will respond to questions and requests for further information.
At the end of the gazetting period, the information will be sent back to the ministry in Madrid, which will take 90-180 days to issue a final review and approval, giving time to gather its internal evaluation. Once approvals have been granted, the wells will each take 3-4 weeks to drill. Tarba Energia's license for the El Romeral concessions is currently valid until July 2034. Prosex owns 49% El Romeral through its stake in Tarba.
In FY23, El Romeral generated gross revenues of €1.8m, supplying enough electricity to cover the needs of c. 6,700 homes in the area, while operating at 1/3rd capacity. With the future wells, the plant should reach its nameplate capacity of 8.2 MW and cover over 20,000 homes. PXEN remains cash generative, with no debt, and well-positioned for further growth.
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