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Po Valley Energy Progresses Development Of Italian Gas Discovery

Po Valley Energy (ASX: PVE) continues to progress its Italian gas developments including completion of the Pre-Front End Engineering and Design study for the Teodorico offshore gas discovery.

Teodorico is located within the AR94PY permit and was discovered previously by Italy's Eni. It has Best Estimate Contingent Resources of 47.3 billion cubic feet of gas.

The study was completed by RINA and is now under internal review.

Po Valley has also started discussions with ENI in relation to tie-in arrangements to Eni's Naomi
Pandora facilities located 12 kilometres southeast of Teodorico.

German seismic processing company TEEC is continuing to reprocess the full 3D dataset.

The company has also completed design, engineering and tender documentation for the Bezzecca pipeline and related surface facilities.

These are now under review by the technical team and the company plans to initiate the tender process for an engineering and construction contract by the end of the first quarter of 2014.

From a technical standpoint, the Environmental Impact Assessment (NYSEMKT:EIA) is complete, however the Lombardy Region is in the process of assimilating the last pieces of required formal documentation to officially close the review.

The company expects to receive the EIA grant in the next few weeks.

Bezzecca was discovered in 2009 with the Bezzecca-1 well flowing gas at a combined rate of 3.9 million cubic feet per day during testing.

Po Valley also expects to receive the Preliminary Production Concession for the Sant' Alberto project after the recent Hydrocarbon Commission meeting held in December at the Ministry of Economic Development did not raise any issues or areas of concern.

The pre-feasibility study for the EIA has been finalised and is ready to be filed with the Emilia Romagna Region once the preliminary production concession has been granted.

Sant'Alberto contains the Santa Maddalena-1 well.

The company has also visited Eni to select new seismic lines for purchase with the aim of progressing several projects, including Podere Maiar (Selva stratigraphic in the Podere Gallina licence area), one of its top strategic priorities in 2014.

Following the encouraging Production and Optimisation study finalised in October, work also continued to progress on the two oil prospects Bagnolo and Ravizza.

In November, the contract with Eni to purchase the well cores for Ravizza-1 and Bagnolo-3 was received and the company is now waiting for the data to be delivered.

A preliminary development concept has been drafted and reviewed by Po Valley's technical team.


Production from the Sillaro and Vitalba fields for 2013 was 23.98 million standard cubic metres (850 million standard cubic feet) of gas.

Total combined production in the second half of 2013 increased by roughly 20% compared to the first half.

During the December 2013 quarter, Sillaro produced at an average rate of 69,000scm/day.

Total production of the field for the quarter was 6.32 million standard cubic metres and total production for the year ended December 31 2013 was 20.90 million standard cubic metres.

Vitalba continued to produce at limited rates due to the increase in water production. Although water production has stabilised over the past few months, the production rate is not expected to improve.

The plant will be used to treat gas fed from the Bezzecca field which will be connected via a slender 7 kilometre pipeline roughly 2 inches in diameter.

Revenue during the December 2013 quarter was €1.8 million (A$2.7 million) while cash at bank is €1.5 million.

The company also paid down €1.5 million under the reservoir financing facility with Nedbank.

As a result, as at 31 December 2013, the current amount outstanding is €3.5 million.

This gives the company substantial headroom under its financing facility to support future investment in production facilities in the year ahead.

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