Aurelian Oil and Gas Plc, focussed exclusively on Central Europe in countries like Poland and Slovakia, was founded in 2002 to gain first mover advantage by entering a proven but underexplored region. Central Europe has produced oil and gas for over 150 years, but due to the history of the region, especially what happened during the Soviet Union years, it has seen very little modern exploration. With “Unlocking Value Through Technology” as the company’s slogan, Aurelian intends to bring in conventional, successful technologies that have been utilised in the rest of the world for a round of renewed exploration activities. The company is also uniquely positioned in its production operations in terms of technology, most noticeably in its unconventional gas productions. In 2006, Aurelia (AUL) floated LSE’s AIM sub-market and shares of the company were at 41.50p as of 16 June 2010.
Aurelian has up to nine exploration and appraisal wells planned for 2010 and 2011, of which six are high impact growth prospects. The company’s exploration, appraisal and development activities are focussed in two core areas: the Southern Permian Basin in central and western Poland and the Carpathian Thrust Fold Belt in southern Poland, Slovakia and central Romania. Both areas have the potential to deliver at least 50mmboes (Million Barrels of Oil Equivalent) of proven reserves. Their strategy is to transfer well-known technology in commercialising proven and underexplored resources, which can be hard if a target is too small to cover development costs.
Aurelian’s most significant current asset in production is the Siekierki gas field in Poland within the Southern Permian Basin, which is a tight gas accumulation discovered in the 1980’s. Like shale gas, which came to be widely known to the public after its recent large-scale productions in North America, tight gas reservoirs are also low in porosity and permeability and considered another type of unconventional gas. To develop tight gas, similar to what was used to develop shale gas in the U.S., a method of horizontal drilling and fracture stimulation is required and Aurelian will be the first to use such technology in Poland, which along with the rest of Central Europe has a significant unconventional gas potential.