Heritage Oil boss says company ‘appetite for Malta still there’

Heritage Oil chief executive Tony Buckingham has declared that his company's appetite for Malta "is still very much there".

Speaking during a conference call from London with journalists this week, Buckingham explained how the controversial acquisition of controlling interest in Sahara Oil Services Holdings Limited in Libya last year, was intended to "gain access into Libya and using the service company to drill off Malta and hopefully bring in the portion on between Malta and Libya which is an ongoing process".

While explaining that various meetings have taken place between the Maltese government and NTC, Buckingham said that he was "hopeful that in the future we'll be able to resolve the outstanding issues".

The Heritage Oil boss stressed that the fiscal terms to conditions in offshore Malta are "extremely good. And we love the potential of Malta albeit it's ranked wildcat exploration acreage".

Earlier this year, Buckingham announced to shareholders that the seismic data collected last year in Area 7 to the South East of Malta, has shown that "primary targets are recognised as major hydrocarbon producing zones in the central part of the Mediterranean".

The company said that the seismic data collection exercise allowed for mapping - with greater certainty - of deeper carbonate reef play within the Cretaceous section of the prospect.

Cunningham said that "well planning is being undertaken to drill the principal prospect in Area 7".

In addition, Heritage Oil said it has also recognised the presence of a "north-south trending shelf margin on the eastern part of the blocks where a number of attractive reef prospects have been mapped".

Heritage Oil entered into a PSC with the Maltese government for a 100% interest in Areas 2 and 7 in the south-eastern offshore region of Malta in 2007.

The licences cover almost 18,000 square kilometres and are situated approximately 80 kilometres and 140 kilometres, offshore Malta, for Area 2 and Area 7 respectively, in water depths of up to approximately 300 metres.

The two areas are close to, and similar to, a number of producing fields offshore Libya and Tunisia.

Heritage Oil claims the licences are "underexplored" with only one well previously drilled in Area 2; the Medina Bank-1 well in 1980. The well was drilled to a depth of 1,225 metres but failed to reach the target horizons, estimated to be between 1,500 and 4,500 metres.

Heritage has an extensive data set of approximately 5,000 kilometres of 2D seismic, including data acquired in July 2011 using greatly improved acquisition parameters compared to the inherited legacy dataset.

Buckingham claims that acquiring controlling interest in Sahara Oil, meant to  uniquely position the company to pursue field rehabilitation activities and be awarded exploration and production licences as we have operator status. "This means Heritage is well placed to play a significant role in the future oil and gas industry in Libya," he said, adding that he views the acquisition as consistent with HO's strategy of "first mover advantage and entering regions with vast hydrocarbon wealth where we have a strategic advantage."