Avanti Energy said its Italian subsidiary has signed a long term gas sales agreement with Shell Energy Europe for its future gas production in the country.
CMI Energia has won the deal which will focus on the Colle Santo project which is the largest undeveloped onshore gas field in Italy.
Avanti has already identified an extension to the Colle Santo field which it said could have “tremendous potential” to expand the existing reserves.
CMI’s managing director, Mark Frascogna said: “CMI is very pleased to enter into this important agreement with Shell. This new relationship with Shell is a significant step forward toward the
Colle Santo gas development project approval.
“Italy is highly deregulated gas market. The gas offtake agreement with Shell allows Avanti to focus on near term reserve and production growth in Italy without the cost and distraction of building and managing a marketing organization.
“At current market gas prices this represents potential sales in excess of USD$400mm.”
CMI is operator and, along with its partners, owns a 90% (net 33.3%) working interest in the project.