Petroceltic hopeful of securing Algeria farm-out partner

IRISH oil and gas exploration company Petroceltic is hopeful of finalising a farm-out partner for its chief asset in Algeria later this year, following a successful start to its evaluation programme on four wells in the country.

The Dublin-headquartered company, which has assets in southern Europe and northern Africa, yesterday announced first results from its f appraisal campaign in eastern Algeria which started in early December and is due to continue into the second quarter of the year.

Drilling results at the AT-4 well in Illizi Basin encountered a “better-than-expected” gross gas column of 155 metres.

Test results at AT-4 are expected in early February. Initial drilling results at the second mine have begun.

Petroceltic owns 75% of the Algerian asset, with local company Sonatrach controlling the remaining 25%.

The Irish company has already identified potential development partners who will likely take over much of the future development costs in return for an equity stake in the asset. It is awaiting approval from Sonatrach before acting.

Petroceltic’s chief executive, Brian Ó Catháin, said a ‘farm-out’ deal should be struck, with regard to Algeria, later this year.

With regard to the current campaign and the results from AT-4, he said management is “optimistic for a positive outcome from testing”.

The company is hopeful of doing further work in Tunisia, where previous drilling activity failed and is confident work will recommence in Italian later this year.

The company’s share price rose by 12.5%, to 18c, on the back of yesterday’s positive news.