INTERVIEW: UK's Serinus eyes Romania gas boost with new exploration drilling

London — Romanian gas producer Serinus Energy hopes to find a gas field similar to its producing Moftinu field through a new drilling campaign, with the Sancrai-1 exploration well due to spud next month, CEO Jeffrey Auld told S&P Global Platts May 13.

In an interview, Auld said the company's strategy was to target Moftinu "look-a-likes" with new exploration.

"We have six well locations we've laid out for the next series of wells," Auld said. "We'll determine when those get drilled based on the results out of Sancrai."

Auld said its approach to the Romanian gas business was a "cookie-cutter" strategy, to "do Moftinu over and over again."

"We've always said that Romania has many Moftinu look-a-likes. The real success of the business is when we can start parallel-pathing one or two of these at the same time," he said.

Auld further said a discovery at Sancrai-1 could be relatively easily monetized. "It's low capital cost, it's shallow gas, and we have a gas processing plant already," he said.

"We have optionality now -- we can put early production through the Moftinu plant or we can build another one," he said.

In the first quarter of 2021, Serinus' gas production in Romania averaged 1,495 b/d of oil equivalent, down 14% year on year. It realized a gas price in the quarter of $5.98/Mcf and an operating netback in Romania of $26.23/boe.

"We have a very low lifting cost and production expense, so anything above about $15/b we're making cash. At $60-$65/b and $6-$6.50/Mcf gas prices in Romania, we have good revenues coming through," Auld said.

At the existing facilities at Moftinu, Serinus is also planning to add compression to the field as part of a natural evolution to keep pressure stable, he added.

Tunisia assets

In Tunisia, Serinus produced an average of 602 boe/d in Q1, but is hopeful it can boost output with the addition of the first artificial lift at the Sabria oil field.

"Putting some pumps in there should have a very material impact," Auld said.

Sabria has 445 million barrels of oil originally in place, of which less than 1% has been produced.

Tunisia was recently rocked by a decision of Shell to hand back its two producing offshore gas assets, while Austria's OMV also sold upstream assets there and Italy's Eni is reported to have quit the Tunisian upstream.

Auld said Serinus was focused on improving its existing asset performance in the North African country. "It's a difficult operating environment -- I think I am on my seventh energy minister in four and a half years," Auld said.

"It needs to look at how it incentivizes companies to be in the upstream industry," he said.

Auld also said the company would continue to eye assets for acquisition. "I am interested in what we can do with specific assets. We spend a lot of time looking at how we can grow organically and inorganically."