Polish Shale Observers Await Outcome of Realm Process
Shareholders of Realm Energy International and observers of development in Poland nascent shale gas industry, continue to wait for news on the outcome of the company’s on-going value creation efforts.
In May, Realm announced that it has retained GMP Securities as part of initiating a process to “identify, examine and consider a range of strategic alternatives available in connection with its interests in Poland.”
Realm said the decision to engage a financial advisor was taken after its Board of Directors has concluded that the company trades at a substantial discount to the inherent value of its underlying assets.
Realm holds interests in three Polish shale concessions. Its wholly owned Gniew concession, located in the heart of Baltic Silurian shale play in Northern Poland, is viewed by industry players to potentially be the company’s most prospective asset.
The Gniew concession covers a gross area of 294,000 acres and lies contiguous to territory to where 3Legs Resources plc. and ConocoPhillips are reportedly preparing to drill a third exploratory well in their campaign seeking shale gas in the Baltic Basin.
Though Poland has seen a series of joint ventures and acquisition activity involves shales, Realm announced that it intends to move forward with drilling programs on acreage positions once seismic surveys have been completed and potential well locations determined.
Industry observers viewed this news as indication of the unsatisfactory terms of joint venture proposals that we being presented to the company.
In announcing that its engagement of GMP, Realm cited an independent report that estimated gas in place estimate of approximately 100 Bcf per square mile (approx. 156 MMcf per acre) for the shale gas prospects in the Baltic Basin.
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