Cabot, Shell Exit Italian Exploration Project
London-listed Cabot Energy and Anglo-Dutch Shell have surrendered rights to the onshore Cascina Alberto exploration block in Italy, Cabot said in a stock filing on September 26.
Italy’s government signed a decree in February ordering all work at existing oil and gas permits to cease to allow a national review of the industry. It also blocked applications for new permits.
“Whilst Cabot’s licences are in suspension, the company continues to review its Italian portfolio”, Cabot said. It noted it was prepared to progress its offshore permits in the Adriatic and Sicily Channel once the government had completed its review within the next 17 months.
“The withdrawal from the Po Valley Cascina Alberto exploration permit is consistent with our strategy to divest non-core assets to enable Cabot to focus funding and management time on the exploration upside within the rest of our Italian portfolio,” Cabot CEO Scott Aiken said.
Outside Italy, Cabot is also developing a light oil play in Alberta, Canada.
Cascina Alberto spans 462 km2 of southern Italy. Shell held an 80% position in the permit and Cabot had 20%. The pair filed an environmental impact assessment (EIA) to conduct a 2D seismic study in December 2017, but are yet to hear back from regulators. Even before the moratorium on oil and gas exploration, Italy had a reputation of long delays in issuing permits and approvals.
Shell has not commented on its exit. But Cabot said it would receive a payment from the major to cover costs and inconveniences incurred in the withdrawal.