ADX Energy Limited – Romania – Update


ADX Energy Ltd (ASX:ADX) (OTCMKTS:ADXRF) is pleased to report that a 30 month extension of the exploration period for the EX-10 PARTA permit has been signed with NAMR (“Agentia Nationala Pentru Resurse Minerale”), the national agency for mineral resources in Romania. The agreement is subject to the standard ratification by the Romanian government. The evaluation of the permit and preparation for additional seismic acquisition has been progressed. The main focus was on permitting the 3D area adjacent to the seismic data already acquired in late 2013. In certain areas this process was very slow, or even obstructed by illegal landowner activities. As a consequence of delays which were out of ADX control, ADX had applied for an extension of the current exploration period to be able to complete its seismic and drilling programs. The extension of the exploration period also enables ADX to resume farmout discussions on the permit.

Background Information on the Parta Permit

The Parta permit covers an area of 1,221 km2 and is located in the southern Pannonian basin area of western Romania. This prospective block covers 7 excised oil and gas fields and is still considered underexplored. The map below shows the location of selected prospects within the Parta permit, together with already discovered oil & gas fields in the area. Several mapped prospects are adjacent to existing fields. In case of a discovery a fast and highly economic development is therefore possible. Some of the exploration prospects have multiple gas and oil targets at moderate depth levels not exceeding 2,000m. Existing wells in the Parta permit discovered oil and gas, good sandstone and carbonate reservoirs at the proven and producing oil and gas fairway which clearly reduces the hydrocarbon and reservoir risk. So far ADX has completed over 90km of 2D seismic and plans to acquire a further 110km following the execution of land access agreements. It is also intended to acquire an additional 200km2 of 3D seismic to delineate further exploration prospects. Based on 2D seismic data acquired to date ADX has identified several leads and three exploration prospects. These prospects are deemed to be drill-ready based on the technical de-risking provided by new ADX acquired seismic which has increased the chance of success and the attractive economics which would underpin a discovery. Robust prospect economics are supported by relatively shallow target depths (800 to 2,000 meters), low drilling costs (< 2 MMUSD per well), availability of infrastructure, good fiscal terms and the proximity to European markets which would result in relatively modest discoveries delivering excellent returns on investment, even at significantly reduced oil prices. As more modern 2D and 3D seismic data becomes available further prospects are likely to emerge. The proposed 3D acquisition area is in one of the most prolific oil producing areas of the Pannonian basin and directly facing a proven oil kitchen area on a direct migration pathway. ADX will provide further progress updates on farmouts, preparation for drilling operations and further seismic operations as they occur.

About ADX Energy Limited

ADX Energy Limited’s strategy is two pronged; grow the European and North African oil and gas business in order to expose shareholders to the lucrative European energy market and to promote it’s existing Australian energy, gold and base metal portfolio to capitalise on the current high commodity price environment. ADX was incorporated in 1987 in order to explore for gold and base metals in Western Australia. The company has recently diversified from its initial minerals focus to include oil and gas exploration. To that effect ADX farmed in PEL 182 into the South Australian portion of the Cooper Basin in 2005. ADX appointed Wolfgang Zimmer, an oil and gas industry professional with over 27 years experience, as Managing Director in late 2007 to grow the company’s oil and gas business. Subsequent director and staff appointments and the establishment of a European office have boosted the depth of oil and gas experience in the company and allowed the company to expand its oil and gas activities. Currently ADX operates permits onshore and offshore Tunisia, offshore Italy and onshore Australia and holds an interest in a non operated block in onshore Romania. ADX is also a participant and operator of a number of AMI’s (Area/s of Mutual Interest) that enable it and its partners to efficiently act upon business opportunities.

Source: ASX release