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ADX ropes in more Austrian oil and gas ground

ASX-listed European-focused, ADX Energy, has secured another 450 square kilometres of fresh oil and gas exploration ground in Austria’s prolific Molasse Basin, with the potential to discover around 42 million barrels of oil equivalent across ten drill-ready prospects. The new licenses surround other producing fields with export infrastructure already in place and which include several low-risk, early cashflow appraisal targets.

Whilst the Perth-based oiler’s Gaiselberg and Zistersdorf oil and gas fields sit within the Vienna Basin in the country’s east, its new Molasse basin licenses are in the west of the country, between the city of Linz and the German border. Also, energy-hungry Munich, the capital of the German state of Bavaria, is less than 100km from Austria’s western production hub.

The company secured the leases via an agreement with Austria’s State Mining Authority and is now the only exploration licensee in the basin, surrounding existing production and associated infrastructure owned and operated by RAG Austria AG. RAG was also the previous owner of Gaiselberg and Zisterdorf fields.

ADX said its technical team, the vast majority of whom are ex-RAG, has achieved a historical exploration success rate of 47 per cent across the basin. Put in context, any success rate that approaches 50 per cent would sit amongst the very best in the world. No doubt ADX will be looking to duplicate that success as it looks towards drill testing up to 6 locations which have already been approved by landowners. Some locations also have existing road access and a prepared drill site.

The company has already identified dozens of other leads and prospects to follow-up in the future and according to ADX’s technical director, Paul Fink some have prospective resource volumes exceeding 10-million-barrel oil-equivalent each.

With just over one million barrels of oil equivalent booked as reserves, the new ground could be a real game-changer for the small-cap oil and gas producer, even if just half of its bevy of new prospects test successfully.

The terms for the new permits include the payment of a bank guarantee to the sum of €340,000, a two-well drilling commitment in the first four-year term and three additional four-year terms to follow.

ADX said it will look to attract a farm-in partner in the new year in the hunt for low-risk exploration targets within reasonable proximity to mature export infrastructure. According to the company, its new portfolio is already attracting plenty of interest.

The Molasse basin, where over 800 billion cubic feet of gas and 70 million barrels of oil have been produced since its initial discovery, has a long history of community support and a strong oil and gas culture, according to ADX.

ADX has also flagged the possibility of chasing down the geothermal potential that has already been proven in the western portion of the basin and is currently being exploited across the border around Munich.

This is a transformational step forward for ADX, made possible by our highly skilled team on the ground in Austria, led by our CEO Paul Fink and our experienced and respected Austrian Managing Director Alan Reingruber.

ADX, through its relationships with RAG and the Ministry and its strategic exclusive data base, has been able to secure an exceptional acreage position with a drill-ready portfolio.

It has all been made possible in a country with excellent prospectivity and highly developed energy infrastructure which has been dominated by only two energy companies for over the last 75 years.

Is your ASX listed company doing something interesting? Contact: matt.birney@wanews.com.au

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