Mediterranean Oil & Gas announces award of Italian concession

The Board of Mediterranean Oil & Gas, the central Mediterranean focused producer, developer and explorer of oil and gas assets, has announced that the Ministry of Economic Development has now awarded the production concession for the Guendalina gas field (AC 35 AG).
As a result of the concession award and given the latest timetable provided to MOG by ENI, MOG expects ENI to start development activities on the Guendalina gas field in January-February 2010.

Based on the last information received from ENI:
-- Construction and installation of the production platform is scheduled to be completed in 2010,
-- drilling of two development wells is planned in the first half of 2011, and
-- gas production and associated revenues are expected to commence prior to the end of June 2011.

ENI is currently completing the review of the required development capital expenditure for the project and has informed MOG that it expects an increase in costs compared to previous estimates provided by ENI. The company expects that ENI will confirm the updated development capital expenditure to MOG by the end of January or early February 2010.
Based on studies performed by ENI, the aggregate gas production from the field is expected to be around 20 mm cfpd (100 % basis). MOG has a 20 % interest in the Guendalina gas field which has independently certified 2P gas reserves of 22 bn cf (100 % basis).

Sergio Morandi, the company's CEO, stated: "The company continues to achieve milestones in its progress towards the corporate goal of becoming a medium sized oil and gas producer."
"The Guendalina field's gas production will allow MOG to triple in 2011 its current annual rate of net gas production."