Gas will flow 800 meters (m) from the Castello surface plant to the SNAM Rete gas pipeline, one of the main gas network distributors into Italy’s gas market.
Under Po Valley Energy’s gas marketing contracts gas from the Castello field will be metered and sold at the corner of the Castello site. This arrangement ensures there are no transportation costs for Po Valley Energy to deliver against its contractual obligations.
“The estimated cost for the operation of the two sites at full production is approximately 2.0 cents per cubic metre which compares with current Italian gas prices of 22.0-25.0 cents per cubic metre. “Low costs, high margins and plant operating performance at Castello will be underpinned by the terms of the O&M contract entered into with Italian facility operator, DG Impianti,” Po Valley Energy’s Chief Executive Officer, Michael Masterman, said.
“Under this contract, DG Impianti will provide O&M services to both Castello and our planned second production field, Sillaro, near Bologna. Both sites will be fully automated and unmanned with DG Impianti providing a regular schedule of supervision and maintenance services and providing for intervention personnel if and when required,” Masterman said.
“The combination of no gas transportation costs and a competitive operating contract should result in high profit margins on both Castello and Sillaro operations.”
