San Leon Energy PLC Oil Shale Development Agreement with EOT (9400K)
August 29 2012 - 2:30AM
UK Regulatory
TIDMSLE
RNS Number : 9400K
San Leon Energy PLC
29 August 2012
29 August 2012
San Leon Energy Plc
("San Leon" or the "Company")
San Leon and Enefit Outotec Technology ("EOT") start cooperation
in oil shale development
San Leon has commissioned EOT to conduct a study of an oil shale
retorting project in a newly awarded onshore shallow oil shale
mining area in Morocco, in addition to San Leon's Tarfaya In Situ
oil shale acreage of 6,000 km(2) which will be pursued in
parallel.
A study by Shell (SHELL INTERNATIONALE PETROLEUM MAATSCHAPPIJ
8.V., THE HAGUE) in 1985 of an open pit mining project located on a
site adjacent to the newly awarded blocks established that mineable
reserves from this location were more than sufficient for a 50,000
bbl/day production over 30 years.
The recent award, following the amendment of the Memorandum of
Understanding between San Leon and the Office National des
Hydrocarbures et des Mines ("ONHYM"), in Morocco of the additional
mining blocks with low over burden and easy access will allow San
Leon to test the suitability of the Tarfaya oil shale for EOT's
proprietary process which is successfully used by Eesti Energia in
Estonia. If found suitable, San Leon envisages a commercial retort
operation for the production of oil, gas and electricity.
Under the cooperation agreement, EOT will undertake a staged
development programme to perform test work and feasibility studies
in order to assess the project's technical and commercial
viability. In subsequent stages further engineering studies will be
carried out before the start of construction of the first Enefit
280 shale oil production plant in Morocco.
Oisin Fanning, Chairman of San Leon, commented:
"We are delighted by the recent shallow blocks awarded on our
Tarfaya oil shale project area in Morocco and to be able to
announce our cooperation with Enefit Outotec Technology with a view
to licensing its state of the art Enefit 280 ex situ retorting
process. The dual strategy of applying Enefit's proven ex situ
retorting technology to the shallow resource while we pursue, in
parallel, our current in situ program in the deeper zone will
ensure maximum early commercialisation of the Tarfaya oil shale
resource. Morocco has one of the largest oil shale reserves in the
world and these projects will help the Kingdom initiate development
of its oil shale deposits to meet its domestic energy needs for oil
and electricity."
Alo Kelder, CEO of Enefit Outotec Technology, commented:
"Production of liquid fuels from oil shale rock is an emerging
industry worldwide that has great potential in providing an
alternative supply of oil to both regional and global markets. We
have developed a technology that is both efficient and clean based
on several decades of oil shale industry experience from Estonia.
Our cooperation with San Leon brings EOT technology even more
widely into the international oil shale arena".
San Leon Energy plc is focused on the exploration and production
of oil and gas projects in Europe and North Africa. The Tarfaya oil
shale in situ pilot aims to prove the concept of heated gas
injection into oil shale beds allowing in-situ oil to be released
and produced to surface. San Leon drilled two test wells to 200m
depth located just 10m apart. Step 1 of this pilot established
hydraulic connectivity between the wells via pressurised water
injection in 2011. San Leon intends resuming the in situ project
operations after completing a comprehensive hydrogeology analysis
of the area.
Enefit Outotec Technology, a joint venture of Estonian energy
group Eesti Energia and Outotec - a global provider of minerals and
metals processing solutions, is a leading supplier of oil shale
technology for production of oil, gas and electricity out of oil
shale. Eesti Energia (internationally known as Enefit) currently
supplies more than 90% of Estonia's electricity from the world's
largest oil shale fired capacity power plant and has more than
fifty years of surface retorting experience. The first Enefit 280
plant utilising scaled-up Enefit technology is under commissioning
in Narva, Estonia. The new plant will double the shale oil
production capacity of Eesti Energia to 10,000 barrels per day.
For further information contact:
San Leon Energy Plc Tel: +353 1291 6292
Oisin Fanning, Executive Chairman
John Buggenhagen, Exploration
Director
Enefit Outotec Technology Tel: +49 (0) 6171 206 35 21
Alo Kelder, Chief Executive Officer
Macquarie Capital (Europe) Limited Tel: +44 (0) 20 3037 2000
Paul Connolly
John Dwyer
Fox Davies Capital Tel: +44 (0) 20 3463 5000
Daniel Fox-Davies
Richard Hail
FirstEnergy Capital LLP Tel: +44 (0) 20 7448 0200
Hugh R. Sanderson
David Van Erp
Westhouse Securities (Nominated Tel: +44 (0) 20 7601 6100
Advisor)
Richard Johnson
Antonio Bossi
College Hill Associates Tel: +44 (0) 20 7457 2020
Nick Elwes
Alexandra Roper
Qualified person
John Buggenhagen, who has reviewed this update, has over 15
years' experience in the oil & gas industry. He has a Ph.D. and
M.Sc. in Geophysics from the University of Wyoming and a B.Sc. in
Geophysics from the University of Arizona. He is currently the
Director of Exploration for the San Leon Energy Group and based in
San Leon's Warsaw office in Poland.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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