Italy reintroduces 12-mile exploration restriction

Restrictions on offshore exploration in Italian waters have been reintroduced, according to UK-based explorer Rockhopper Exploration.

The firm says the Italian Parliament has approved its 2016 Budget Law, which reintroduces restrictions on offshore oil and gas activity within 12mi of the coast of Italy. The restriction was originally introduced in 2010, but repealed in 2012. 

The Italian government has been making moves to enable exploration activity off its shores, as its economy has struggled since and, despite having its own resources, relying on imports. 

Italy has the fifth largest proved reserves of crude oil in Europe with 560 MMbo as of 1 January 2014, and it is sitting on the sixth largest gas reserves in continental Europe (at 2.1 Tcf), according to the US Energy Information Administration. According to an IOGP report, Italy has some 5 billion boe yet to be discovered.

However, regulatory bureaucracy and drilling bans have meant the resources are being left underexploited. 

No exploration wells were drilled in Italy’s offshore since 2008 (a drilling ban was imposed in 2010 following the Deepwater Horizon disaster in the US Gulf of Mexico) and there are no incentives to change this, the Offshore Mediterranean Conference in Ravenna was told last year. Meanwhile, neighboring countries, such as Croatia, have been more active in encouraging offshore exploration. 

For Rockhopper, the reintroduction of the ban could impact its Ombrina Mare project offshore Italy, which has also faced opposition locally, due to its proximity to a coastal nature reserve.

Rockhopper says certain exceptions apply for existing production concessions under the new legislation, which came into force 1 January. 

Rockhopper has also been granted a 12-month extension to the suspension of the Ombrina Mare exploration permit, to 31 December 2016. Ombrina Mare is within the 12 mile limit and Rockhopper says it is now conducting an in depth review of the new legislation, how the exploration permit is affected and its impact on the Ombrina Mare project.

The Ombrina Mare oil field lies 7km off the coast of Abruzzo, in approximately 20m water depth, according to analysts Wood Mackenzie.

The field was discovered in 1987 by Elf Aquitaine and since 2005 has been worked up by Mediterranean Oil and Gas, who were taken over by Rockhopper last year.

Following successful appraisal in 2008, the aim was to perform a fast-track development. The main obstacle to the development of the Ombrina Mare field had previously been the introduction of the offshore drilling moratorium in August 2010, following the US Gulf of Mexico Maconda disaster.

According to an Italian website set up to object to the scheme, Ombrina Mare would involve an eight well platform connected to a floating production facility. 

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