JOHANNESBURG (miningweekly.com) – Shares in Australia’s Po Valley Energy (PVE) surged on Friday, reaching an intraday high of 10c each, up from the previous day’s closing price of 4c each, following the news of significant commercial discovery at its new Selva gas field in northern Italy.

By 16:00 in Sydney, the stock traded at 6.3c a share.

Strong gas flow rates have been recorded at the recently drilled Podere Maiar 1dir exploration well on the Selva gasfield, within the Podere Gallina exploration licence, which is 63% operated by PVE.

The drill programme intersected two identified gas reservoirs, C1 and C2, in the medium-upper pliocene sands of the Porto Garibaldi formation, with the thickest level C2 reporting a peak flow rate of 148 136 scm/day on a 3/8" choke and a pressure differential of 11 bar with no water production.

Pressure recovery to formation pressure occurred in two minutes. The higher level C1 also reported strong flow test results with a peak flow rate of 129 658 scm/day on a 3/8" choke with good pressure recovery.

Po Valley says the strong flow rates from two gas bearing levels, high quality 99.1% methane gas content and the well’s 600 m proximity to the Italian national gas grid pipeline connection made the Podere Maiar 1dir well a commercial discovery.

As operator, Po Valley will now prepare and submit a production concession application to the Italian Ministry in the first half of this year.

The Ministry has been formally informed of the discovery and officials attended the successful test. The log and well test results will be analysed during the current quarter with Po Valley expecting to provide revised contingent resource and reserve estimates in the June quarter.

This work will include reservoir engineering to optimize production from the two gas levels over the field life.

PVE CEO Michael Masterman noted that the strong flow rates achieved with small pressure differentials and fast recovery were above the company’s expectations. “We have drilled six gasfields in the Po Valley of Italy and this is PVE’s sixth success – a robust exploration and development record backed by an exceptional management team.”

Crucially, further upside exists, as in addition to the Selva field, Podere Gallina holds several other targets, including the much larger East Selva prospect.