Adriatic Elsa license suspended

Offshore staff

DUBLIN, Ireland -- Work on the Elsa field development off eastern Italy continues to be delayed, according to operator Petroceltic.

Elsa, in the central Adriatic B.R268.RG permit, is one of numerous projects affected by uncertainties in the legal interpretation of Italian Legislative Decree L.D. 128, which was passed into law this past August, This prohibits drilling anywhere offshore Italy within 5 nautical miles of the coastline and within 12 nautical miles around the perimeter of protected marine and coastal parks.

The problem, Petroceltic says, is that although the decree states that it does not apply to “existing titles”, the impact of the law on existing exploration licenses remains unclear.

Petroceltic sought approval from Italy’s Ministry of Economic Development to suspend its license until these issues have been clarified. The suspension was applied on March 1, and the partners have since extended their existing agreements concerning a farm-out of the permit. The $26 million of funds raised for drilling the proposed Elsa-2 appraisal well remain available.

03/16/2011

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