Quarterly Activities Report September 2015
Perth, Oct 29, 2015 AEST (ABN Newswire) - ADX Energy Limited (
ASX:ADX) has revised its operating philosophy in order to reduce costs, stream line decision making and increase its access to skills.
The key initiatives are as follow:
- Appointment of Mr Ian Tchacos as Executive Chairman, Mr Paul Fink as CEO and Ms Amanda Sparks as Joint Company Secretary providing access to extensive international oil & gas operations, management and corporate experience.
- Minimising fixed overhead by eliminating fixed salaries and only paying management and technical staff based on actual work accomplished.
- Centralising administrative and accounting functions to Australia and minimising non-productive overheads elsewhere.
Asset Strategy
ADX intends to focus its attention on lower risk appraisal and development assets which are capable of being rapidly commercialised in benign political regimes and favourable operating environments.
The Nilde abandoned oil field, together with surrounding discoveries offshore Italy in license d363 C.R-AX, provide an excellent opportunity for the Company to appraise a material potential resource base of unproduced oil (in Nilde) and additional near field discoveries. The potential resource is in a high productivity reservoir located in shallow water, at shallow drill depths, and is potentially economically enhanced by favourable fiscal terms.
ADX will continue its farmout efforts on its existing Romanian onshore exploration asset (50% interest in Parta Permit) as well as its offshore Tunisian appraisal and exploration assets (100% interest in Dougga gas discovery in the Kerkouane permit) but is prepared to relinquish operatorship and accept a lower retained interest in exchange for a greater work program carry and/or cash.
ADX will also pursue new ventures opportunities that provide an appropriate risk profile within its geographic focus areas in the Mediterranean Sea, Italy and Eastern Europe.
OPERATIONS
Offshore Italy Pantelleria Permits & d363 C.R-AX permit (Operator, 100% equity interests)
A data room visit at ENI's offices in Italy has enabled an initial assessment of the abandoned Nilde oil field and three satellite oil discoveries in the Italian license d363 C.R-AX (refer to the "Nilde Oil Field Background" section further within this report). Work undertaken to date indicates potentially significant undrained oil at Nilde together with additional resources defined at undeveloped discoveries proximal to Nilde. ADX is in the process of purchasing the necessary data from ENI required to further quantify these oil resources during the last quarter of 2015.
Offshore Tunisia Kerkouane permit (Operator, 100% equity interest)
Further measures to reduce unproductive overhead costs were undertaken for the Tunis office.
3D seismic acquisition design for a prospective area north of the Dougga gas condensate discovery has been undertaken and several seismic contractors were invited to submit cost estimates.
Onshore Western Romania, Parta Concession (Operator, 50% equity interest)
ADX has been awarded a 30 months license extension for the Parta Permit by the NAMR ("Agentia Nationala Pentru Resurse Minerale") and made progress with the government ratification of the extension (which needs to be signed by three ministries). During the ratification progress the license work program clock is stopped and hence no time is lost to undertake the exploration program.
In addition ADX has made good ongoing progress gaining land access contracts from landowners to enable further 2D and 3D seismic acquisition.
ADX has received ongoing attention from potential farminees that have expressed their interest in the Parta asset once the extension of the license has been ratified by the Romanian Authorities.
Riedel Resources Limited Share Investment
ADX holds 26.7 million shares in gold and base metal explorer Riedel Resources Limited ("Riedel") as a result of the demerger of the Company's gold and base metal assets in 2011. Riedel has recently reported high grade gold intersections from drilling on the Dixon Prospect at the Marymia project in Western Australia. For further information please refer to the Riedel website (www.riedelresources.com.au).
FINANCE
ADX's cash at the end of the September 2015 quarter was $1.044 million.
Nilde Oil Field Background
The Nilde oil field was discovered in shallow water offshore Sicily and came on stream in 1980 when the oil price was US$37 per barrel. High productivity was achieved from vertical wells (in excess of 9,000 bopd per vertical well) of light oil from shallow reservoirs at a depth of approximately 1500 meters making production from essentially a single well development (Nilde-2) highly profitable for the first few years. A second well was drilled very close by (less than 1km) in 1986 to increase production to 12,000 bopd when oil prices started to decrease significantly. Due to an interpreted strong water aquifer this resulted in a sharp increase in water cut without the ability to artificially lift the wells. The decision to abandon production instead of drilling additional development/appraisal wells within potentially undrained areas in the field in 1988 to 1989 is reported to be triggered by a collapse in oil price to US$14 per barrel.
ADX believes that the potential for undrained resources at Nilde, combined with nearby satellite oil discoveries made in the 1980's which have encountered productive reservoirs similar to Nilde, may provide a substantial resource.
To view all tables and figures, please visit:
http://media.abnnewswire.net/media/en/docs/ASX-ADX-739833.pdf
About ADX Energy Limited
ADX Energy Limited's (
ASX:ADX) (OTCMKTS:ADXRF) is an Australian Stock Exchange (ASX) listed International Energy Explorer which is soon to become a Producer. The Company's Geographical focus is Onshore Europe and Offshore Mediterranean with a portfolio consisting of recently acquired Production as well as Appraisal, Development and Exploration Assets. ADX's interests are located in Romania, Italy, Tunisia and most recently Austria. The Company's immediate focus is on low cost, low risk, profitable resource commercialisation opportunities onshore and higher cost higher reward offshore projects in the longer term. The Company is headquartered in Perth, Western Australia with additional operating offices in Bucharest (Romania) and soon to be Vienna (Austria). The Company also has representative offices in Italy and Tunisia.
ADX Energy's vision is to establish a stable cash producing platform onshore Europe and develop a number of rapid resource to reserves opportunities as well as low risk exploration potential with access to infrastructure in favourable fiscal and operating environments.
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