Prospex Energy (PXEN ), an oil and gas investment company, updated markets this morning on its Podere Maiar license in Po Valley Italy, containing the Selva gas field. Prospex holds a 37% interest in Selva, with the operator "Po Valley" holding the remaining 63%.
Prospex said that operator Po Valley has approved all payments to secure ownership of the land for its Podere Maiar well site in Selva field, following regulatory acceptance of Po Valley's application by Italy's Institute of Services for the Agricultural Food Market (ISMEA).
All materials relating to the 1km gas pipeline to connect Podere Maiar-1 to the Italian grid have now arrived on site, and expenditures relating to land titles and pipeline remain within budget, the company said. Once ISMEA confirms the title, Po Valley will have full access and control over the land required to construct its gas treatment plant and pipeline at Podere Maiar-1.
Podere Maiar remains on track for first gas in early Q2 2023.
Mark Routh, Prospex's CEO, commented:
"We are extremely pleased that Po Valley has secured the land ownership at the Podere Maiair-1 well site location and has purchased the land from several different owners under which the 1km 4-inch gas export pipeline will be installed to connect the well to the National Gas Grid. Procurement of the steel pipe and related equipment for the tie-in work is complete and all materials are now stored at the well site."
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Today's announcement marks another important step in the process of bringing Selva field to operation. Prospex continues to make the right investments to answer strong European demand for locally produced energy, particularly in natural gas and renewables. As has been the case with its El Romeral plant in Spain, Prospex's natural gas operations in Italy are expected to yield strong revenues amid rocketing energy prices.
Last month, Prospex announced a key contract with TESI to install the gas plant and pipeline for the project, securing development costs at £2.91m - less than previously expected. Po Valley also said on 19 September 2022 that it was able to procure the land at below original cost estimates, further enhancing the profitability of the field.
Prospex last month raised £1.87m to fund operations at Selva, and has confirmed that it will be able to fund its share of Podere Maiar capital expenditures from existing resources.
The company's May's FY21 final results revealed steady expansion with a total assets increase of 56% to £8.9m, reflecting "measured recognition of positive changes in the forward curve of European gas prices as at 31 December 2021."
Investors have also welcomed Prospex's diversification into solar. The company's pilot solar Project Apollo saw a 41.5 kW solar array installed on the roof of its 49.9%-owned El Romeral gas plant in Spain. Project Apollo paved the way for the much larger Project Helios, a 5 MW (5000 kW) array, to be built next to El Romeral and cogenerate with the plant, sharing its connection to the Spanish grid. Project Helios is currently at FEED stage. Solar in the Toledo province of Spain currently has an ROI of only 3-4 years, making this an ideal hedge for the company.
PXEN shares have completely defied the recent downturn in equities, rising 142% YTD.
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