DUBLIN, Ireland – Petroceltic (PCI LN) hopes to resume work on its Elsa field offshore eastern Italy’s Abruzzo region.
The company was forced to suspend an Elsa appraisal well when Italy’s government declared shallow-water drilling off limits in response to the Macondo incident in 2010.
Last year, Italy’s ruling coalition was replaced by a new technical government, designed to address the country’s financial problems. According to Petroceltic, the political upheaval, combined with the ongoing impact of the restrictive DL 128 legislation, effectively halted most upstream investment offshore Italy.
However, the Minister for Economic Development recently outlined a new energy strategy designed to help re-start domestic hydrocarbon production. Petroceltic says the new government clearly sees the upstream sector as a potential source of jobs, growth and energy security, and intends to improve the regulatory landscape to encourage investment and development.
This new strategy also appears to be a response to Italy’s loss of supply during the Libyan conflict and restrictions on the import of Russian gas during the past winter. It includes a target for Italy’s domestic production to supply 20% of the country’s demand, compared with under 10% currently.
Petroceltic welcomes the new approach and believes it will assist development of its Italian portfolio. It is now optimistic that the suspended Elsa appraisal well will come up for review this year, and that some of the exploration license applications around the Elsa permit offshore Abruzzo will finally be granted in 2012.