Aegean Energy chairman sees promise for IOCs in Greece

Aegean Energy SA is considering several new drilling operations off Greece after recent exploration showed signs of additional undersea reserves.

Eric Watkins
OGJ Oil Diplomacy Editor

LOS ANGELES, Oct. 14 -- Aegean Energy SA is considering several new drilling operations off Greece after recent exploration showed signs of additional undersea reserves.

Chairman Mathios Rigas told Greece’s Kathimerini newspaper the company will tap more oil reserves off the coast of Kavala in northeastern Greece by the end of first-quarter 2010 as the company raises current production levels.

Aegean, which explores for oil and gas through its 95% owned subsidiary Kavala Oil SA, is implementing a 5-year, $200 million investment plan—the biggest the sector has seen in Greece in more than 25 years.

As part of its investment, Aegean is developing three fields 18 km offshore: Prinos, Prinos North, and Epsilon. The firm expects to increase production levels by 66% to 5,000 b/d by yearend, up from 3,000 b/d, with further expansion possible in 2010.

Rigas told the paper international oil companies are taking a closer look at oil and gas exploration in Greece as one of the few countries in the region with unexplored potential for hydrocarbon production.

His firm’s drilling program for 2009 includes three wells: one in the Prinos North field, which was successfully completed at the end of July; one extended-reach well in the Epsilon field, now being drilled; and a sidetrack well in the Prinos field, which is scheduled for yearend or early January.

The company is “confident” that Epsilon will start producing before yearend, bringing Aegean’s production to 4,500-5,000 b/d from 3,000 b/d currently, Rigas said, adding, “Maximum production capacity stands at 30,000 b/d.”

Rigas said Aegean already has invested more than $50 million for the first well and is investing a further $30 million for Epsilon.

In March, Aegean conducted a large-scale seismic study off Kavala, which revealed some “very interesting potential targets” that are under review by the firm’s geologists.

Aegean plans to extend its contract for the Ensco 85 jack up rig for at least two more exploration and appraisal wells in first-quarter 2010.

Rigas said Greece is one of the few countries in the Mediterranean that hasn't been properly explored, citing activity in Cyprus, Albania, Turkey, Romania, and other countries in the region. “This is the only spot where there is only one operator working and one field producing,” he said.

Contact Eric Watkins at hippalus@yahoo.com.

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