MCF Energy advances European energy security with strategic Czech acquisition

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MCF Energy Ltd. has taken a significant leap forward in its growth strategy by announcing a pivotal agreement to acquire valuable oil and gas production and exploration licenses in the Czech Republic. This strategic acquisition is set to bolster Europe’s energy security by leveraging the immediate production potential of the assets and their considerable exploration upside. Located in the Vienna Basin within the picturesque Carpathian Mountains of Czechia, the acquisition comprises three production licenses covering an area of 6,880 acres (27.8 sq km) and three exploration licenses spanning 42,551.5 acres (172.2 sq km).

James Hill, CEO and Director of MCF Energy Ltd., highlighted the strategic intent behind the acquisition, noting, “This acquisition was driven by the opportunity to quickly start natural gas production by reopening three closed wells and using fifteen ready-to-drill sites in the NT Ridge area.” He further emphasized the low-cost drilling potential in nearby areas with available pipeline capacity as a main advantage of the project.

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The production licenses, namely NT Ridge, Krasna NP-823, and LM, hold two proved and productive targets: the Miocene sands and Devonian carbonates, with significant untested potential in oil-productive fractured basement. MCF Energy aims to return a shut-in production well at NT Ridge to operation in Q1 2024 and has identified several development and drilling locations for the near future.

An Independent Reserve Report by Boury Global Energy Consultants confirmed 15 Proved Undeveloped locations within the NT Ridge area, estimating 11.9 BCF of Proved and Probable reserves. The report attributes a Net Present Value before tax (discounted at 10%) of US$53.55 million to the NT Ridge area’s reserves, highlighting significant additional upside from the other production concessions.

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The exploration licenses, covering areas such as Skalice-Ropice (North), Moravka (South), and Trinec (North-East), present MCF Energy with the opportunity to significantly increase its inventory of drilling locations and reserves. Plans include drilling multiple wells over the coming years to test for proved reservoirs and explore potential ‘bonus’ zones.

The acquisition deal involves issuing 17.5 million MCF Energy shares to the seller and a cash payment of US$1,325,000, with additional shares allocated for advisory services. Management of the Czech assets will be overseen by Third Source Energy S.R.O., led by Sean Pearson, an energy executive with extensive experience in resource management and production growth.

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MCF Energy Ltd.’s strategic acquisition in the Czech Republic is a forward-thinking move that not only underscores the company’s growth ambitions but also contributes to Europe’s energy security through sustainable exploration and production. The immediate production potential, coupled with the exploration upside, positions MCF Energy as a key player in the European energy market. This investment reflects a well-considered strategy to leverage low-cost drilling opportunities and untapped reserves, promising significant returns for shareholders and contributing to the region’s energy independence.

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