Key Highlights

  • Italy's Ministry of Environment and Energy Security (MASE) has confirmed admissibility of the Environmental Impact Assessment for the Selva Malvezzi four-well drilling program, with a 60-day public observation period now underway.
  • Po Valley achieved realised gas prices of €0.67 per standard cubic metre during August, producing the highest monthly Revenue at the field in over three years of continuous production.
  • A new 12-month gas sales agreement has been signed with Hera Trading S.r.l, commencing 1 October 2026, covering an estimated 28,185,300 standard cubic metres over the contract year.
  • The Podere Miair well produced approximately 2,500,000 standard cubic metres gross in August, generating approximately €1,670,000 in gross revenue, of which Po Valley's 63% share equated to approximately €1,052,100.

Environmental Approval Process Advances

Po Valley Energy Limited (ASX:PVE) has announced that Italy's Ministry for Energy and the Environment (MASE) has confirmed the admissibility of the Environmental Impact Assessment for the Selva Malvezzi four-well drilling program. A 60-day period for public observations began on 1 September 2026. The company had submitted the relevant documentation before the end of June 2026, and has stated that its technical team is prepared to respond to queries raised during the public consultation process.

Record Monthly Production Revenue

The company reported that gas prices remained elevated through August, supported by broader European gas market conditions, with Po Valley achieving realised prices of €0.67 per standard cubic metre. This translated into the highest monthly revenue recorded at the field in more than three years of continuous production. The Podere Miair well produced approximately 2,500,000 standard cubic metres of gas on a gross basis during the month, generating gross revenue of approximately €1,670,000. Po Valley's 63% working interest share of this amounted to approximately 1,575,000 standard cubic metres in Volume terms and approximately €1,052,100 in revenue.

New Gas Sales Agreement with Hera Trading

Po Valley, through its Wholly Owned Subsidiary Po Valley Operations Pty Ltd as operator, together with joint venture partners PXOG Marshall Limited and UOG Italia Srl, has signed a new 12-month gas sales agreement with Hera Trading S.r.l, commencing 1 October 2026 and running to 1 October 2027. This follows an earlier agreement disclosed in August 2025. The new agreement covers an estimated 28,185,300 standard cubic metres of gas Supply for the thermal year, delivered at the Budrio SNAM delivery point, with pricing linked to the PSV Day-Ahead component of the Italian Gas Index. The agreement contains no automatic right of extension, with the parties required to commence extension discussions at least 30 days before the contract's expiry.

Contract Terms and Operational Management

Under the terms of the gas sales agreement, Po Valley Operations will provide provisional nominations on a monthly, weekly and daily basis, with actual and binding nominations required by 5pm Rome time each day, subject to a nomination tolerance of plus or minus 10%. Payment settlement is to be completed 20 days after the end of each month. Po Valley Operations, as operator, will handle the contractual management relating to appointments, nominations, transportation cost calculations, and pricing and revenue calculations on behalf of the joint venture partners.

Management Commentary

Po Valley Chairman and CEO Kevin Bailey said the record month of August had added to the company's cash reserves as it accumulates funding for its planned drilling campaign of four additional wells, which it hopes to commence in 2027 following the receipt of permitting from MASE. He described the commencement of the 60-day observation period as a welcome development, and characterised the renewal of the gas sales agreement with Hera as a continuation of the company's commitment to the local Bologna-based economy.

Conclusion

Po Valley Energy's August operational update combines a regulatory milestone in the Selva Malvezzi permitting process with a record month of revenue at its existing Podere Miair production and a renewed 12-month offtake agreement with Hera Trading. The company continues to accumulate cash ahead of a planned four-well drilling campaign targeted for 2027, contingent on receiving the necessary permits from MASE following the current public observation period.