LONDON (ShareCast) - (Sharecast News) - Prospex Energy confirmed on Tuesday that Spain's regulatory authority has initiated the statutory consultation process for the environmental impact assessment (EIA) related to the drilling of five new natural gas wells on the El Romeral production concessions.
The AIM-traded firm said the concessions, operated by Tarba Energía, were granted a 10-year extension last July, allowing production to continue until July 2034.

It said the five planned wells would target optimal structures within the concessions, producing biogenic gas from shallow horizons at an average depth of 700 metres.

Each well was expected to take three to four weeks to drill once a suitable rig was mobilised.

The Ministry for the Ecological Transition and the Demographic Challenge had circulated the EIA and supporting documents to the Area of Industry and Energy in Seville and 29 statutory consultees, including public administrations and stakeholder groups.

A 30-day public consultation period would start once the EIA was officially gazetted, expected in the coming weeks.

Following the consultation, the Junta de Andalucía would submit its findings to the Ministry in Madrid, which was expected to take 90 to 180 days for final review and approval.

In the meantime, Tarba would advance preparations, including detailed well design, procurement of long-lead items, and securing contractors to execute the drilling programme.

"This is a positive step in the process to approve the permits to drill five new wells on the El Romeral concessions," said chief executive officer Mark Routh.

"Having prepared an extremely thorough and professional environmental impact assessment study, including a statutory 12-month monitoring of the potential impact on local flora and fauna, Tarba has now progressed to the stage of statutory consultation with interested parties mostly located in Andalucía.

"Natural gas will continue to play a crucial role in Europe's energy security and the ecological transition process, and the production of shallow biogenic gas from the onshore El Romeral concessions will have a carbon footprint which will be a small fraction of the comparative carbon footprint resulting from the importation of natural gas by pipeline, and even smaller when compared to liquefied natural gas imports."

Routh said it was important to highlight that the El Romeral power plant would reach full output capacity from production of just two of the five wells.

"Any extra gas from the remaining new wells or any future wells drilled on the concessions will support expansion plans at the power plant as well as the ability to supply natural gas directly to the grid.

"We are very much excited by the development potential of El Romeral and look forward to keeping shareholders updated on the permitting process."

At 1432 GMT, shares in Prospex Energy were up 0.63% at 7.55p.

Reporting by Josh White for Sharecast.com.

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