Prospex Energy PLC, the AIM quoted investment company focused on European gas and power projects, is pleased to announce that it has qualified to apply for onshore open acreage hydrocarbon exploration licences in Poland. In March 2024, Prospex incorporated PXEN Tatra, a 100% owned subsidiary and on 21 May 2024 applied to the regulator in Warsaw for the pre-qualification to apply for licences. On 3 October 2024 Prospex officially secured the qualification to apply for licences in Poland.
Prospex has identified and hopes to acquire prospective blocks in Poland, which meet the Company's stringent investment criteria; namely, areas which have proven gas production, high potential prospectivity in the targeted geological horizons, high potential for new reserves to be unlocked and can be brought onstream within two to three years. Details of the new licence areas will be made public when the official applications are publicly gazetted after the submission to the Ministry of Climate and Environment which is expected before the end of October 2024. Licence applications will be submitted initially based on 100% working interest and if successful, Prospex expects the licences to be granted by Q1 2025.
Mark Routh, Prospex's CEO, commented:
"After several months of preparation, I am very pleased to announce that Prospex is applying for licences to search for and develop onshore natural gas in a third European nation. Poland is well known for its hydrocarbon resources and has a regulatory regime which is supportive of natural gas investment with a track record in quickly approving permits for hydrocarbon exploitation activities as the nation focusses on its security of energy supply.
"There are several reasons for choosing to expand into Poland, aside from the favourable regulatory environment and prospective hydrocarbons, one of them being our experience in country. The Prospex senior team has valuable prior exploration experience in Poland and is very familiar with the regional geology and importantly, the regulatory environment. During the operational phase in 2016 Prospex met all local regulatory commitments, which puts the Company in a good position to leverage the experience and relationships gained at that time.
"The Prospex technical team has identified attractive onshore areas for the application and we hope to be able to announce a positive outcome from the applications in Q1 2025.
"The Company's strategy is to add additional geographic reach to the existing portfolio of producing assets in a cost-effective manner. The Company's entry into Poland has been financed entirely from production income.
"I look forward to updating shareholders on progress with these applications in the coming months."
Details on the Application Process
In November 2023, the Board approved implementation of a low-cost plan to apply for licences in Poland. The Prospex technical team visited the dataroom at the Polish Geological Institute in Warsaw during the second week of January 2024 to identify the optimum blocks for which to apply.
In February 2024 an established local geo-technical firm was engaged to prepare the technical geological work programmes for the licence applications. The geological work programmes include maps, cross-sections and graphics, which comply with the standards required by Polish Geological and Mining law.
In March 2024, Prospex registered a wholly owned subsidiary company called PXEN Tatra Spólka Z Ograniczona Odpowiedzialnoscia ("PXEN Tatra") or PXEN Tatra Sp. Z o. o. (which translates to PXEN Tatra Limited Liability Company). The company has been named after the Tatra National Park and the Tatra mountain range in southern Poland, which form a natural border between Slovakia and Poland.
In the early months of 2024 Prospex identified prospective onshore areas which have passed the rigorous vetting process by the Prospex technical team. Namely: areas which have proven gas production, high potential prospectivity in the targeted geological horizons, high potential for new reserves to be unlocked and can be brought onstream quickly, possibly within two to three years. Applying these criteria, the team worked up geological work programmes and PXEN Tatra expects to submit the applications to the central Ministry of Climate and Environment in Warsaw for the licence areas before the end of October 2024. After submission, details of the applications will be publicly gazetted at which point details of the application blocks will be disclosed. The licence applications will be submitted with PXEN Tatra initially having 100% working interest, and should such applications be successful, and in line with the AIM Note for Investing Companies, the Company's primary strategy will be to establish joint ventures to manage and operate the blocks.
In order to manage the applications, in April 2024 PXEN Tatra engaged an experienced Country Manager in Poland. Prospex already has a consultant Reservoir Geologist based in Poland who is an integral part of Prospex's technical team, so this natural expansion of the team ensures that we can manage operations effectively.
On 21 May 2024 PXEN Tatra submitted the pre-qualification to operate and to apply for licences to the Ministry of Climate and Environment in Warsaw. That pre-qualification involves demonstrating the technical capability and financial capacity of Prospex to own licences and is a necessary step prior to any licence application. PXEN Tatra's pre-qualification was approved on 3 October 2024 and the licence applications are expected to be submitted directly afterwards before the end of October 2024.
The award of the blocks will be based upon the proposed geological and geophysical work programmes and the work commitments. PXEN Tatra will propose an appropriate work programme in order to achieve licence award and maximise the chances of success of commercial discoveries. Details will be disclosed when the licence applications are made public. Licence awards could happen in Q1 2025.
Prospex is signing an LOI with AGH University of Kraków to enhance cooperation and communication with the Department of Geology giving the Company access to high-powered academic capability.
This announcement contains inside information for the purposes of Article 7 of the Market Abuse Regulation (EU) 596/2014 as it forms part of UK domestic law by virtue of the European Union (Withdrawal) Act 2018 ("MAR") and is disclosed in accordance with the Company's obligations under Article 17 of MAR.