Mediterranean Oil & Gas seeks US$30m investment to search for oil off Malta

Mediterranean Oil & Gas Plc has this week opened its data room in a bid to attract a potential investors who are willing to inject an estimated US$30 million, for the company to sink a well in Area 4, offshore Malta.

Addressing investors in Mayfair's Chesterfield Hotel in London last Thursday, MOG's chief executive Bill Higgs said that his company "hopes to keep a free carried interest in the order of 25-30 per cent of Area 4 when the deal is finally negotiated".

According to Higgs, his team of analysts have identified "four or five prospects in the Eocene that we are very excited about".

The company shot over 1,000 square kilometres of 3D seismic earlier this year, which it has finished processing and is currently interpreting the data.

He described Malta's offshore Area 4 - which borders Libya - as a "potential value catalyst" for MOG, adding that the area has a "best estimate" of 1.3 billion barrels of prospective resources.

Higgs said the area on the southern reaches of the block are "analogues" for proven Libyan and Tunisian finds.

"I think we have done absolutely everything we could technically to de-risk this licence without drilling a well," Higgs said, adding that the quality of the work carried out in Rome has been outstanding.

"It has been a good investment to acquire the 3D data and I hope we will attract a good partner to join us in exploring the licence," he said.

Meanwhile, MOG is also currently preparing to take advantage of Italy's prospected re-opening of its southern borders for oil exploration.

At the end of last month, and as part of a package designed by technocrat Prime Minister Mario Monti to jump-start the Italian economy, companies were told they could restart work.

But crucially, the new law only applies to projects that were already underway before the ban was introduced in August 2010 following the catastrophic BP spill in the Gulf of Mexico.

There is still a lockdown on new development off the Italian coast.

The reforms have given a boost to businesses with assets in the affected waters, including MOG, whose shares doubled in value as rumours of the changes leaked into the market.