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BNK boosts Spanish footprint

Trofagas Hidrocarburos has been awarded a 234,000-acre concession in the Castile and Leon region

BNK Petroleum has increased its shale-gas holdings in Spain, ramping up its hunt for the unconventional fuel in Europe.

The California-based company’s wholly owned Spanish arm, Trofagas Hidrocarburos (TH), had been awarded a 234,000-acre concession in northern Spain’s Castile and Leon region. “It’s one of the projects we really like,” Wolf Regener, chief executive of BNK told PEU. “We’ve had enough encouragement to go and confirm what we think is true.”

BNK previously told Petroleum Economist that it has been assessing Spain’s shale-gas reserves for the past two years and that the potential is “very promising”.

Spain’s shale-gas reserves are unknown, but there could be almost 6,000 trillion cubic feet (cf) of recoverable shale resources in 32 countries – excluding the US, Russia and the Middle East – according to a new report by the Energy Information Administration (EIA). The US government agency said Europe alone could be sitting on reserves of 639 trillion cf.

BNK acquired the new concession mainly for shale-gas exploration, but added that the acreage also has some potential for conventional oil and gas.

The company must meet certain requirements to retain the concession, which include conducting geological work in the first year, and drilling two wells each in years two, three and four and three wells in year five.

In April, BNK bought its first shale-gas acreage in Spain. The tract, in Cantabria, covers 61,200 acres, and BNK plans to spud its first shale-gas wells there in 2013.

Under the terms of the exploration agreement, BNK will carry out geological studies in the first year and will then drill at least one vertical well in years two, four, five and six.

The addition of this new concession brings BNK’s total acreage in Europe to around 3.8 million acres across five basins in Poland, Germany and Spain. These include 1.1 million acres in Poland’s Baltic basin and 2.4 million acres across multiple basins in Germany, where it aims to drill its first shale-gas wells next year.

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