$2M IRTC credit facility in hand, PNN seeks JV opportunities for producing wells
Velca Block drilling is a high priority.
And yet, Pennine Petroleum Corporation may even see some production activity—in Albania, and possibly elsewhere—sooner than that.
Following a May 18 announcement of a CAD$2-million credit facility with Ionian Refining and Trading Company (IRTC), Pennine (TSX-V: PNN) is actively seeking and evaluating additional oil and gas production opportunities in Albania, in addition to its Velca Block concession.
Additionally, Pennine executives attended last month’s Global Petroleum Show, an industry-leading oil and gas exhibition in Calgary, Canada, holding discussions with other Balkan and eastern European country representatives to gauge their levels of absorbing Canadian expertise.
“We’ve already held discussions with a number of firms regarding joint venture opportunities in Albania,” says Pennine CEO N. Desmond Smith. “Our Velca Block concession is a greenfield project, but we may be able to seize on opportunities for wells already in production.
“Part of the credit facility agreement with IRTC was to facilitate exploring other producing Albanian fields that we’ve been looking at,” he adds. “We’re looking for the opportunity to assume operation of existing wells and modernize them, with a view to drilling a horizontal well in the short term.”
In other words, while Pennine is expecting to have Velca Block drill targets selected immediately following analysis of existing data, potential joint venture opportunities could mean earlier production activity, says Mr. Smith.
As mentioned in previous Paydirt coverage, Pennine leadership recently spent a day at the Ministry of Energy and Industry’s seismic data storage center in Fier, where geophysical and core data, and chip samples from all wells drilled in Albania, are housed.
“Accessing this facility allows us to gather and analyze existing data for our areas of interest,” Mr. Smith told Paydirt. “Effectively, this reduces risk—since this scientific information narrows down our target sites for drilling.”
Harry Sargeant IV, Vice President of IRTC’s parent company Global Oil Management Group, recently told Paydirt that the relationship that his company has forged with Pennine will help position IRTC as the highest-margin refiner in southeastern Europe.
“The potential for Pennine to produce a light- to medium-density crude oil not only gives our refineries the ability to source much-needed incremental barrels for our refinery runs, but also will help created value-added products derived from the lighter crudes,” said Mr. Sargeant, who joined Pennine’s Board of Directors on May 8.
“Pennine’s product is more economical, and it’s derived locally.”
Added Mr. Smith at the time of the board announcement: “Mr. Sargeant’s participation in the company is a natural progression for the development of the Velca Block asset, as well as providing leverage to acquire other interests.”