Sound to Spud Nervesa Well Within Weeks

Italy-focused Sound Oil expects to spud its first appraisal well on its onshore Nervesa discovery within weeks, after it announced Thursday that a land rig currently being used in the Netherlands is about to be released to the company.

LP Drilling, the owner of the contracted TB2100S drilling rig, has informed Sound that its operations in the Netherlands are being finalized, with mobilization to Italy expected to begin within the next fortnight. The estimated time taken to transport the rig to Italy is up to six days, while rigging up the rig will take another six days after which the well will be spud. Preparations at the Nervesa sites are now "materially complete", Sound said.

Drilling and logging is expected to take up to 30 days, while six days has been set aside for completion and clean up. Well testing should then take an additional five days.

Sound CEO James Parsons commented in a company statement:

"Nervesa is a 21 billion standard cubic feet gas discovery which was discovered by ENI in 1985, flowed for a couple of years and has an independently assessed base case value of circa $60 million.

"Following the decision to drill a second Nervesa well in 2013, the company estimates initial annual cash flows in a success case scenario of circa $21 million per annum, after tax and after the CSTI funding.

"The successful drilling of this flagship asset will be the first step in unlocking the significant value inherent in the Sound Oil portfolio. April and May will be critical months for the company."

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