This is a significant plus for Po Valley with further share price catalysts ahead.
Gradizza-1 is estimated to host best estimate Contingent Resources of about 2.7 billion cubic feet of gas.
The confirmation of commercial viability is based on results from rigless production testing carried out in November 2013 and the reservoir static model.
The company and its partners had in December agreed to apply for a production concession which will be filed with the Ministry of Economic Development in February.
The greenfields Gradizza-1 well is located on the top of the crest and intersected 10 metres of net gas sand with no Gas Water Contact detected.
The structure is located in the Ferrara province north of Bologna and was identified from an interpretation of 68 kilometres of 2D seismic purchased from Eni.
Drilling risks were managed through farm-outs to AleAnna Resources and Petrorep Italiana, who paid a disproportional share of costs for drilling the well to earn their 10% and 15% interests respectively. Po Valley retains a 75% stake in La Prospera.
Gradizza-1 was originally estimated to have a 27% chance of success.
With the declaration of commercial viability for the Gradizza-1 well, Po Valley Energy has fully validated its credentials as a targeted explorer and producer.
The upcoming application for a production concession will pave the way for the company and its partners to develop the well. Given that Italy imports about 90% of its gas, there is also every reason to believe the company will little difficulty finding buyers for Gradizza gas.
Other potential share price catalysts include the review and interpretation of new 3D seismic data acquired from Eni over the Vitalba West Prospect in the Cascina Castello production concession to finalise a well location and drilling program.
While a potentially smaller prospect, this is located only a short distance from the existing Vitalba gas production facility and within the current production concession licence area, offering potential to be tied in quickly in the event of a success.
Another key catalyst will be the development of the Bezecca-1 well, which will be tied into the Vitalba facility.
With a market capitalisation of $14.69 million and a share price of $0.12, Po Valley is leverage to further exploration and development news.
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