Welcome, everybody. Thank you for coming along to this meeting, an online webinar for shareholders and investors, to get an update on developments at Prospex Energy. I'm Andrew Raca. I'm Head of Corporate Finance at VSA Capital, and I'm joined here with colleagues from VSA and also with one of the sales guys at Hannam & Partners, who are also joint brokers to the company. So, welcome. Prospex and its advisors are keen to maintain an open and transparent dialogue with shareholders and investors. To this end, we've arranged this event to enable Mark to connect directly with all those attending, to answer questions, and to share his vision and plans for the future. We've got about 25 people online, and we've got about 12 people in the room, which is great. I suspect a few more people will be coming in during the meeting and online.
Mark will give a short presentation, which will be followed by a question-and-answer session. For those of you online, please submit any questions that you may have, anytime during this session, and you can do it, on the screens in front of you, and I'll try and ensure that Mark gets to answer all of those questions during the course of the session. For those of you who are here in the room, please continue to help yourselves to drinks. After the formal session, we've arranged for sandwiches and more refreshments, which are available next door. For those of you online, you'll have to make your own arrangements. Mark, when we planned this session, a few weeks ago, we didn't anticipate that on this very morning you would be making quite a disappointing announcement on Viura.
And Viura's been going so well, alongside all your other investments, which have been going so well. So given the latest developments, it's absolutely perfect timing that we've got this session today. So that gives you an opportunity to outline fully the latest position, the latest news, and to answer questions, which I'm sure people will have. So, Mark, over to you.
Thank you very much, Andrew. And thank you for hosting the event today. So I've got the updated corporate presentation on the screen, and it's been uploaded to the website. It's been updated following today's news. So I'm not gonna talk to every single page on the screen. I'm just gonna use it as a structure for the meeting in order to go through, if there are any shareholders or investors who are not familiar with the company, I'll give a very brief update. So I'll rattle through. And I think we'll probably take questions at the end, but if anyone wants to jump in and ask a question here in the room, then I'll be willing to field that.
Mark, there's been some requests online if you could, try and speak into the microphone as much as possible. People are possibly hearing, having some problems.
I'll endeavor to speak up. Is that better? Or we're getting some feedback?
Okay. It's coming through to you.
All right. Prospex Energy, we're listed at PXEN, as many of you know. The assets and concessions we have in Europe, two in Spain and one in Italy, the ones marked yellow are concessions with production. Obviously, Viura is temporarily ceased at the moment. We've got 11 wells to be drilled on the concessions at various stages of the permitting process. We have increased our production from the company, in particular with the acquisition of Viura, which I'll come on to more details as we go through. I must stress that the company is debt-free, and we have no warrants outstanding.
That means that our investments we can cover our overheads and G&A comfortably from the production income, and that means that we can reinvest the cash, which has been generated from our production income, into the assets, into the drilling of the wells and the 3D seismic plans, which I'll come on to later. That is the Board of Directors. We have a new hire, Richard Jameson. Since we acquired the 100% of Tarba, I'm gonna need some extra help to manage the asset. He is gonna be joining. He has joined, but is away at the moment. So onto Viura, we expect production to resume in mid-June. It is disappointing that what has happened on the main well, which was drilled in December. It has a production leak in the tubing.
This requires, unfortunately, a rig intervention to repair the leak and get the well safely back on production again. I have every confidence in the operator, HEYCO Energy, who is the majority owner in the field, and who is mobilizing the necessary equipment, not only the rig, but the equipment and the required spare parts in order to repair the tubing leak. What is also gonna happen, the existing production well, which is called Viura-1 ST, Viura-1 Sidetrack 3, was producing in the past, drilled by the previous operator of the field. This well has been producing a lot of water. When it was completed, it was completed with what's called a slotted liner with no cement behind the pipe. That means that any production coming from the reservoir can go into the well, whether it's water, gas, or oil, or whatever it is.
There's no oil here, but we've got water and gas coming in from Viura-1 Sidetrack 3. That is being a conduit of water up through to the top of the new well, Viura-1B. Now, this is something that couldn't have been predicted. So as part of the workover plan in June, the operator will go and work over that well and basically plug off all of the slotted liners, which are providing a conduit from the water in the base of the reservoir, coming up to the crest of the reservoir, and probably migrating its way across through to the Viura-1B well. I have a schematic of the whole Viura field here. It's just a schematic, but it's showing that the original well and the new 1B well are close together.
But they are. The 1B well is a deviated well drilled in December, January of last year, completed in December of last year, and has been on production for three or four months up until early April, when this tubing leak was discovered. So they're close by, and this water that's coming through is meaning that the plant has to handle that water, and that water's being trucked away because the injection well, which is on the schematic here, was worked over, and it was deemed that it was not a suitable well to inject water into. So there's been a few knocks that we've got to deal with.
What we have here is an asset which we acquired, when we did the fundraise last August for some GBP 4.8 million when we bought our share of 5%-7.5% of the company which owns the asset, which means we have 7.24% in the field. What we acquired was an asset which has 90 BCF of likely estimated gross recoverable reserves. We own the part, the processing plant that you can see on the picture there, and that's a picture with the rig drilling the Viura-1B well. That processing plant can process up to 1 million standard cubic meters of gas per day.
We were flowing some 300,000 from Viura-1B in December, and that rate declined as the water was coming through, and the rate declined slightly to being averaged in the last quarter of something like 220 million cubic feet per day. So cubic meters, 220 million, sorry, get units right, 220,000 cubic meters per day, which is some 17, 18 million scf a day. So that rate has been producing up until mid-April. Point is, this is a sound asset, and it's an asset where we're going to be drilling development wells. This is development wells because they are going to be drilled into a structure which has got proven gas in it. So under the PRMS guidelines with the SPE, it is a proven reserve. So we are going to be drilling development wells into that proven reserve.
Crucially, that means that some banks will lend you money against that because it's a development well on something which is an asset, against which you can borrow money. The operator's working on that with a syndicate of five banks, but that requires a stable production rate to be demonstrated from the field, which is what the operator's doing for this workover. We're gonna have to wait till June for that to happen. I hope that explains what's happened as of this morning. It's a little bit complex, and we're trying to, me and the technical team and Prospex are on top of the situation, and we are planning meetings to get further information flow from the operator. We are a non-operator here with a minority stake. That doesn't mean to say we don't care about it.
We do deeply care about it because, as you know, it's the majority of our production. When it was in production, it was some 40% of our production in the company. So that was a rather long section on Viura. Other things in the asset portfolio are going according to plan. We've got production in from two wells in the El Romeral asset, and they produce gas into the gas-to-power station, and we sell the electricity on the stock market, into the grid, operated by Red Eléctrica, in Carmona, which is east of Seville in southern Spain, Andalusia. On this asset, we've got five wells waiting for permits. I've got a schedule, an updated schedule on this presentation, which I'll talk to you later in the meeting.
Just to reiterate, the two wells in Viura have their permits approved, but they're not gonna be drilled till next year now. So back to El Romeral. This is the map of the three concessions. We've got five structures, on which, we've identified the optimum place to drill for new gas. We now own 100% of this asset. We're targeting some 18.2 BCF of gas, from these structures. The likelihood, likely chance of success of drilling these structures is very high. The wells are between 500 and 900 meters deep. They'll cost just over EUR 1 million each to drill, and they'll take two to three weeks only. We're just waiting for the permits to land, which will be toward the end of this year.
And hopefully the other news that happened yesterday with a blackout in the Iberian Peninsula apparently was caused by an over-reliance on renewables. One would hope that the powers that be would see that onshore indigenous gas in Spain will be a good base load to prevent any such occurrences happening again. So maybe our permitting process could accelerate. It's been in the process for some two and a half, nearly three years. If we have, if we drill gas here, if we drill the wells here, we only need two of the wells to come in, and we're 100% capacity on the power station. We've got three generators in the power plant, and we can only run one at a time because we have not enough gas behind pipe. Just two of these would mean we'd be at 100%.
Any further gas we could export to the Enagás pipeline, which actually traverses diagonally across the concession, 26-inch Enagás pipeline, which is a high-pressure grid pipeline. We could export our excess gas into that. Tesorillo, just to say this is, many people will know about this. It's a suspended exploration permit in the south of Spain. The upside here is it's an enormous prospective resource, 830 BCF. We need to get the permit to drill that in the future. This is blue sky upside for the company. But we are now 100% of this, having acquired 100% of Tarba. This is Selva Malvezzi. The Podere Maiar-1 well has been producing at a very steady rate of 80,000+ standard cubic meters per day. And this is generating cash for us in our subsidiary in Italy.
There are four wells on this concession being planned and in the permitting process. The map there shows the Selva field, which is producing. We've got structures there which are mapped on the 3D seismic, which are going to be refined. There's north and south Selva, and Riccardina and east Selva are planned to be drilled. I'll come back to those on the drilling timeline later. I'll be coming on to that next. Before I come to that, briefly on Poland. Update this morning is that the ministry has our applications, and we submitted them in January. They had some questions which were detailed. We had to resubmit the applications, which required, believe it or not, printing it out, a translation in paper copy and sending it to the ministry. That took some time.
We are told, I was told this, just this afternoon that the ministry has some further questions on both of the license blocks we've applied for and will require a resubmission, which will probably happen in mid-May, so I'm still hopeful that we'll get awarded these blocks. The next process is that the ministry says, yes, we approve your application, and if they do that, they then publicly gazette that we have applied to allow anyone else to counter bid a work program on the same blocks. We've been at this for some 18 months already, so I think I doubt anyone else has got the preparation that we have had to outbid us on these licenses. But we shall see. This is Poland, so this has not changed. This is the update of our different categories of reserves, resources, and prospective resources.
This is the production from. It's a bit blacked out here, but this is up to the end of Q1 2025, so the end of March. That's actually unchanged. But Viura obviously is not producing right now. When we get back into production in June, I hope that we'll have, we'll be at similar or a higher level than this. This is an updated slide on the drilling schedule. What I'm showing here now, the workover is happening in June on Viura and the development wells on Viura happening sometime in 2026. It's probably Q2 at the earliest. In El Romeral, the earliest expected time I can see that the five wells are going to be permitted is going to be toward the end of 2025. Who knows?
We hope that could accelerate with the news in Spain and Portugal from yesterday. Drilling wells onshore in Spain would seem like a very good idea to me. Lastly, on Italy, the drilling timeline there, we're looking at a 3D acquisition and processing happening at the end of the summer after the planting season in the Po Valley. Then the permits, which are in the process for south and north Selva of Riccardina and east Selva, should be landed by the end of the year to allow mobilization of a suitable drilling rig in Q1 2026 through to Q3 2026 when the drilling will happen. We're waiting to hear on when those permits will land. That's where we have 11 wells on our existing production concessions. This is a very good organic growth story for Prospex.
It has been my mission to grow this company, and we're still growing it, and it will continue to do so, hopefully successfully. That was all I was going to talk about today. It's a bit of a long section on Viura. I was trying to answer any questions that might be coming, but if you have further questions on that, I'm happy to field them as best I can. Thank you very much.
Thank you, Mark. So Viura. Perhaps that's a good place to start. Are there any questions on Viura from the floor or indeed from people online? Yep. I am picking up one or two questions online here, but we'll deal with them in due course. But Viura. Yeah, Please.
Yeah, on Viura. So, you know, obviously you've got a very good partner in HEYCO, and within your RNS this morning, you talk about their ability to get access to state-of-the-art technologies. So it sounds like you've got a great partner in that. But could you give the flavor or an example of, you know, the types of technologies they can bring in country and be a benefit to the, to the field?
Yes. It must be said that there's no drilling operations happening or very few drilling operations happening currently, onshore in Spain. That rig I showed in the picture on the Viura field that was drilling the 1B well last year, it was a Polish rig that came in. And myself and the team have all visited the Viura site in March and also in December.
So we've been around the plant and looked at it. To mobilize equipment into Spain, it has to come from other European nations or, in extremes, it comes from the USA. Now, I don't actually know what the effect of the recent tariffs tomorrow is going to have on that. And I think that HEYCO is waiting to find out as well. So I'm afraid I can't update anyone on that issue. But the technical team in HEYCO is populated by a team from ExxonMobil in the U.K. They have a local team in Madrid, and they have the HEYCO Energy team in Dallas, Texas. Now, specific technologies I refer to in Dallas, Texas, they're using a lot of equipment to do fracking, gas fracking. But that is not allowed in Europe.
Although there are some other concessions elsewhere which would benefit from that, but that's another story. We're not going down that route. All of the gas that we are partners in is conventional gas, not required hydrogen dissemination or fracking. As an example of the type of equipment that needs to come through in Q1 2026, there was a plan to test the Utrillas B reservoir, which was discovered by the Viura-1B well in December, which is beneath the Utrillas A main reservoir. You've got the main reservoir it's producing from, which has got the proven 90 BCF of gas.
Beneath that, you have the Utrillas B, hitherto undrilled prior to last December, which has discovered reservoir quality gas-bearing sandstones, which was not able to be tested because the drill went down and we deepened the well in a six-inch hole, which meant it had to be cased off with a four-inch liner. So in order to test that, you had to bring perforation guns, which are slim hole perforation guns, and they would have had to be mobilized from America. And it's equipment like that, because that's not available in Spain. That type is the type of equipment to which I was referring from. Yes.
In terms of the rationale for why the drilling has been delayed, is it the inability of Prospex to fund their share of the next phase of drilling, or is it HEYCO that, why kind of we're waiting for the syndicated banks to start financing? Because from previous RNSes, I'd understood that there was potential to be cash funded from the production revenues. And just to follow on, in terms of the additional OpEx or the incremental capital that's going to be needed, can you quantify how much that's going to be? And in terms of the next phase of drilling, are there any expected costs that are run and hence why there's been that delay? I just don't like some length of delay.
Okay. I'm not sure if the, our online people can hear the questions.
I think the first question was, is the delay down to Prospex not being able to fund it? And the answer is no. The delay on the workovers is down to mobilizing sufficient equipment in order to perform the workover. The cash pools coming in from Viura have been covered, which we have covered the phase one of the drilling campaign. The workovers will be cash pooled in the next few months. We don't have the precise numbers there, but it's looking like they're not as high as before. I don't have the exact numbers there. We have production income from other assets as well. We have accrued income from the gas that's been produced from Viura-1B since December.
That income will offset any cash that we will be required to fund for the next phase. I don't have the numbers, but we'll be working on making sure that we can cover what we need to on our share of the field. Now, there's a third question, which I think I didn't get.
Yeah. Just going to go back to the first question, because you've mentioned that you needed certain production consistency to be able to raise debt capital financing. But so you say that is not a reason why HEYCO is relying on debt financing to fund their share of the next phase drilling costs. So I'm not quite sure if the debt financing is the reason, the timelines for whether it's solely due to kind of resourcing, because a month ago, it was May, the timelines were under the.
Yeah, there's a couple of factors here. So is the reason for the delay purely the debt financing? The answer is no. There are several reasons that the delay has happened, and it was a bit disappointing that the drilling has been pushed back quite so far into 2026. But there's a couple of factors there. The operator is reprocessing the existing 3D seismic on the field, and they're about to embark upon a six-week program to do some specialist reprocessing on that data. And the plan would be to optimize the subsurface locations of the future wells. Now that will take some time to do, something you can't rush. The operator will take some extra time to process the 3D seismic for the subsurface optimization.
The second thing is the deficit is, yes. In order to borrow money against an asset, you have to have an asset which is producing. The banks will not lend you money on an asset unless they can see the production, and they will force you to hedge a proportion of that. This is all debt financed, which is being run by the operator, not by Prospex. Prospex will share in the debt finance that will be available to the company, HEYCO Energy Iberia, which is the company in which we own 7.5%. So the debt financing is linked to that. The third thing which has made the delay happen is the procurement of the necessary equipment to drill those wells and in particular to do the workovers now. So that means a lot of changes.
If there's any effect of the tariffs which are happening, I don't know if that's a yes or no. There's some factors which I don't know about, but most of the factors are outside our control in Prospex. What I do know is that HEYCO Energy is on top of it because they are the majority owner in this field, and they want this to happen more than anyone else. I hope that addresses the questions you had.
Mark, if I could ask a question just to answer that, VSA Capital, we've known HEYCO Energy for over 10 years. It's a really very professional outfit. How are you finding HEYCO as a partner to work with as operator of this field?
They are highly competent people.
We, on the three site visits I've been to in Viura, I'm very confident that the team in Madrid know what they're doing. We have communications with the HEYCO Energy top management in Dallas, Texas on a regular basis. So, yeah, it couldn't have been a better introduction by VSA Capital to partner up with HEYCO Energy on this asset. It's been an excellent addition to our portfolio.
Had a question from Daniel here.
Yes. I cannot help but say thank you and your team and the directors for the tremendous work you've done to this. I know how this company started from almost nothingness. I know where we are right now. Again, thank you for the communication effectiveness. It gives people like me hope.
Despite the fact that sometimes I even believe that the stock exchange doesn't give all the credits to the publications, many times you see the share price low, but still hopeful. Having said that, I just have three questions to include in this. One is the fact that a recently done well eventually started leaking, you know, anything can leak, you know, nobody's perfect. Having said that, is there any part in the contract such that the contractor will simply go and repair what wasn't effective or is Prospex going to be charged for that? That's one. The other one is, if the company is going to be charged for that. Thanks, we've heard that the company is buoyant enough to take care of its operation at the moment. Can we still go through that effectively? Then the third one is, whatever happens, there will always be learning points.
I came from Shell and we don't regard anything as there must always be learning points. So this thing that happened will give opportunity for the company as a whole to have some learning for all the other assets that we have.
Okay.
So that it doesn't shut down and then production is not done for some time.
It's quite difficult to do three questions at once, but the first question was, is the contractor liable for the failure of the downhole equipment? Is that what you're saying? I think it was the first question.
Yes.
So the answer is no. The contracting strategy in the oil and gas industry, as soon as you become the operator, as soon as anything passes the racking table on the drill floor, it becomes the property of the operator, not the contractor.
And if you lose it, you have to pay for it. If it breaks, you have to fix it. If it fails, you have to get a new one and buy a new one from. That's the way the contracting strategy works in the oil and gas industry. It's stacked against the operator and the contractors will charge you money. The completion string that's gone down the Viura-1B well is quite a complex thing. It's got packers and it's got sliding sleeves because the operator was going to be sliding the sleeves up and down to open and close different sections of the reservoir. Now, in all, in all likelihood, that is a fairly complicated completion string. And something has gone wrong, and I'm not sure exactly where. We've got some scheduled meetings coming up with HEYCO to determine what the failure is and how.
And your third question, I'll come back to the second one. Third question was, are the learnings to be had? The answer is absolutely yes. And, this is where Prospex actually being a partner with HEYCO, having a technical team within our group, this is something that we can all share and gain learnings from. Now, the second question, I now can't recall.
The second question is, since the contractor is not liable, can we still be comfortable financially to go through this? You know, because right now you say we have enough money to do our operations, but with this repair, are we able to do it in-house? Are we going to get some money somewhere in other situations?
I would hope that we should be able to fund this, yes, from existing production income, especially the income that's accrued already from Viura and the income which will then be reestablished from June. I hope that that accrual will allow us to fund it. And we do have production income from Italy and elsewhere. So the answer is we hope so, yes, but until I know the exact numbers, I will have to let people know where we stand. I, my intention and my desire is not to have to go to the market to raise money. A, it's very difficult, and B, it's our shareholders, which is not a popular thing. And we all, we're trying to grow the company by organically. If we can do that without having to go to the market, then that is better for all concerned.
The debt facility is, which it is true that is one reason for the delay. We've got to get the workover done. The debt facility will mean funding can happen without further requirement to go to the capital markets. But I need to get the numbers and I don't have the numbers yet. Any more questions online, Andrew?
Not on Viura.
If we're still talking about questions, Viura.
Yeah, James.
On, so firstly, I'd just like to reiterate some of the points that were just made. A great deal that you did on Viura as exactly as a shareholder, what I want to see. You know, even given today's news, I'm still delighted that we're part of it here. It's a great respect for having a great feeling. It's great to be part of it.
So my first question is really relating to the water. You know, for, since before HEYCO got involved, before you guys got involved, water's been an issue on this field. And handling the water, knowing where the water's coming from has always been a big uncertainty. So what comfort do you have on understanding where this water is really coming from? You've described it coming from the one best-in-three well into the new well, but are we really that certain of that? Or, you know, it seems like water can come anywhere and just getting a grip on that should be a big issue here on Viura. And the second point, comes to your point on the, debt financing potential on Viura, I assume you're going to need a reserve report.
Will that be undertaken by, you know, Prospex or the operator, and will it be made available to the shareholders?
Yes. So I'll answer the second question first. Is there going to be a reserve report on Viura? Because that'll be required for the deficit, is it? The answer is absolutely yes. That will be commissioned by the operator and paid for by the HEI investors. We will make that available as soon as we have it. However, that CPR, the Competent Person's report, will be using the latest and updated reprocessed 3D seismic, which, as I say, is just embarking now upon a six-week program to do some specialist reprocessing. There will then be a period of interpretation of that data, and they want to map the reservoir.
We are hoping, because the Viura-1B well discovered gas in the Utrillas A at a deeper depth than it was discovered before, I expect that 90 BCF proven resource to increase. By how much? We can't tell until we've remapped the field and we've got the gas water contact. We know where that is. We've got the gas down through, actually. We know where that is in the well. So yes, the CPR will upgrade the resources and that will be made available on the website. Now, as to your first question, which is where the water is, where's the water coming from? We start to get into technical details, which you, James, know far more than I do on this. I have a dangerous amount of knowledge on geology because I'm an engineer.
What we have is a reservoir which is a conglomerate and sandstone and it has fractures. It's a fairly tight reservoir, but it does produce gas, and some of that gas is coming through the fractures, and some of it's coming through the primary porosity. Now, we've got one well which has gone adjacent to the main producing well. One well went down, drilled by the previous operator, and it's also a slotted liner with no cement behind it, so that means from top to bottom, any reservoir fluid, be it water or gas, can come into that well and it can migrate up to the top of the reservoir.
The thinking is, from HEYCO, that that water can actually then travel across the crest of the reservoir, and start water coming through into the new well. We're told that the new well 1B was producing completely dry gas from the top zone when they tested it. No water at all. The lower zones, there was some water production seen. The plan for the workover, I understand, and we're going to learn more about it, is to recomplete the Viura-1B well, produce it, complete producing the top zone only. On the original well which is producing the water with a slotted liner, that's going to be plugged with calcium carbonate in order to completely block it off so that it can't actually produce any water or gas.
They'll use calcium carbonate because that can be, that blockage can be reversed with an acid. So it's actually quite a clever. This is another example of technology coming from Dallas. Using calcium carbonate to break things off rather than cement means it can be reversed if ever you want to. But this is a level of detail which I can't put in an RNS and which it's interesting for people who understand the subsurface aspects, but it's not something which is generally easily shareable on an RNS or with the market.
Great. Well, if I could take some questions from online, thanks to everyone who's been submitting questions online. Actually one of the questions is. It's a quick question just with regard to the mothballed turbine that you mentioned. Any plans regards to renewing or replacing it?
Yes, we've had a quote to sell the mothballed turbine and replace it with a new one. And that quote has been put on hold while Warrego was selling the turbine, sorry, while Wells Fargo was selling its share in turbine. Now there's little point in refurbishing that or selling that turbine until we've got permits to drill the wells. So when we get closer to drilling the wells on El Romeral, we'll look at replacing that turbine.
Okay. Turning to Poland, if I could, a couple of questions from attendees online. In Poland, the process, how long do third parties have to make a counter bid? That's the first question. And just secondly, where are we on Poland in terms of, you know, a little bit more meat, I think would be helpful if you can give it.
Yeah, we hope to hear by mid-May what questions the ministry are fielding. We then resubmit our applications, answering those questions. The ministry then will either say yes or no to our application, and then it gets publicly gazetted. That process is probably now June, July before the ministry decides. There is then a 90-day process, which can be up to 180 days on the gazetting before anyone counter bids. Now, and that cost, I think that's about the right number, yeah. So you've got 90 days up to 180 days. So we're looking toward the end of, looking like the autumn before we're going to get to here. I'm afraid that's the process that we have to go through with the ministry.
Okay, thank you.
Can I turn now to a finance question, a general finance question? The question is, and this is probably quite a tricky one to answer for various regulatory constraints, but the question is, can you tell us how much cash the company has been generating prior to the Viura blip? And if all of these plans come off, assuming the current gas falling pricing, how much free cash will the company be generating?
Yeah, well, that is quite a difficult question to answer. I mean, I've answered before on referring to this slide here. You actually can't read the numbers on this, but it's the top line. So, we're producing some 78,600 standard cubic meters per day. I think there's a number that hasn't been updated on this.
So 78,000 standard cubic meters a day. And the gas price at the moment is EUR 34 per megawatt hour, which translates to about EUR 0.36. Yeah, 78,600, there we go. So that's EUR 0.30, 0.36 per standard cubic meter. You multiply those two together, you get a gross revenue of EUR 850,000 per month. Now, that is revenue, not income. So from that is deducted the operator's fees, the taxes, the royalties, the VAT, our overheads, and these numbers vary by month. And to get those numbers absolutely sacrosanct, they have to be audited. And we're going through that process now with our audited accounts, which are going to be published before the end of June. The AGM is going to be in mid-June. So our audited accounts will be published actually next month in May.
So we're going through that process now, but Prospex Energy is an investing company and we're investing in assets in our subsidiaries, and that cash stays in the subsidiaries and we do not consolidate it up to the top company. So I'm not going to give you a direct answer to that question. I don't have the numbers. I do know how much cash we have by day, and that's something I watch very closely, but that's not something that I'm going to publish. I don't think any public company publishes exactly what cash it has day by day.
Indeed. And I thought that that would be a difficult question to answer, but thank you for just outlining the complexities of that particular question. Any other questions from the online?
If you've got any, please submit them through, or alternatively, if there are any further questions from the floor.
I've got one for VSA, actually. VSA. Why do you VSA only assign one pence per share to Romeral when it's got all the potential advantages? You've talked about five wells for Romeral and going through to be drilling with production and the electricity generation. One pence a share just seems ridiculous to me.
Well, the question is, for those online who didn't hear it, about the VSA Capital research that's out there in the public domain, available on the company's website. It just so happens that we have our Head of Research, Oliver O'Donnell, in the room, and I'm going to ask Ollie. Ollie, put you on the spot.
Would you like to just comment on that as loudly as possible so that other people in the room, online could hear?
Yeah, sure, yeah. Obviously that was updated, but the consolidation, sorry, not consolidation, but average should be higher. Yeah, it was put on there so we can tell. And so it's one, one, one piece per share on the near-term production, and then it's a further one piece on the 70 BCF exploration potential, but that's really by a 10% chance of success in that given the business that it's in Spain. So that'd be asking 5-10% on the chance that any of that's going to happen on that additional 70 BCF, but that doesn't include the initial quantity that it would have to have a total production. Yes, agreed. Right after 100%.
There is one, you know, factor that I think the company could negotiate on, and that could have obviously some benefits there to the legacy rules and have a strong premium sale as well from, meaningful as a premium benefit of 100%. It doesn't necessarily make it 100% just by itself. But there's no point in doing that.
So I think the answer was that we have to wait on the permits for the five wells to land before we get an increase in the valuation on Romeral. And hopefully it's a very conservative approach that we're taking. A very tricky one there. Thanks, Ollie, for that.
Any further questions online? This is last call for questions online, and anyone else on the floor before we wrap this up and Mark can just give a an overview of summary? Any further questions? Yes.
Hi, you've got other kind of wells planned, but I don't think there's been any information shared around what the incremental CapEx cost for Prospex would be on the Selva Malvezzi fields, for example, as well. So I don't know if you have a schedule of costing over the next, say, 18 months and, you know, just more visibility because a lot of the funding is potentially from existing production income to be funded. At the same time, we don't really have visibility on what quantum costs we're talking about for all the other fields development plan.
Yeah, well, this is the conundrum that I face because we've got wells which are being permitted and that permitting process is, the schedule for that is unclear because of the regulators. It's different in Italy, it's different in Spain.
In Viura, the wells are permitted, and you've got the timelines that I shared earlier. The costs for those are not. They're not cast in stone. We've got some cost estimates. We will know what the costs are when we get closer to drilling, when the rigs are procured, and then we know what the rig rate is. We've got some numbers, and the trouble is sharing the estimated numbers and then it turning out to be a different time and a different schedule is also a misleading activity. So, we're managing it as best we can. Obviously the longer we are in production without having to drill, the more cash we have to put towards that. But if all 11 wells came at once, then yes, we'd have to raise money to do that.
However, I have already had an offer for people to come and farm into the El Romeral concession. We're now 100% there, so people are making a way, making a path to our door to say, can we, can we join in? And if what that means is if, what we would offer when the permits land, I could go and say, well, we've got permits of wells here which are going to produce, come in and fund our wells, and you can earn a share in the field. So we can not raise money to drill those wells by what's called farming down in the asset. So putting together a schedule of what the costs are, would it, it could itself be misleading. But what I'm trying to do and what I am achieving is to grow this company and make it bigger.
If we can grow it from indigenous production, that's all well and good. If we can grow it by having to farm down some of it, that's less good, but that's also better than issuing more shares for cash, but we've got to look at all options because what I do not want to do is to diminish our share in assets having worked so hard to acquire, and it has to be said, the acquisitions, we, I've said in the RNS before, we, we look at so many deals and we get offered deals in far-flung places, and we turn down more deals than we actually evaluate, and when we evaluate them, we're very rigorous. We start, I've said to my technical team, if the blocks produce the hydrocarbons, then we'll look at the commercial deal. If, if they don't, then don't.
The technical team has to be said when they evaluated Viura, I said, this is a proven gas field. The issue is going to be if water comes in and how they handle the water. So they actually got it spot on. And as James Smith was saying, this, the Viura acquisition was a very good acquisition for the company to grow it. Now, I've gone off on a tangent slightly on your answer, but I'm not going to give a schedule of exactly when the drilling and the costs are going to be because it's too unknown.
Okay, right, Mark, one question has just popped up, based on what you've just said, and I'm glad my friend from Hannam is here today, Lee. The question is, I understand that Mark is not able to share some figures today.
However, can Mark assure us that Hannam & Partners will be given current best estimates company assumptions by Mark to form a full view on future cash flow for their broker note under construction? I think I know what the answer to that is, of course, but do you want to comment on that question?
Well, we have been, the whole team has been busy furnishing the Hannam analysts with models and information and full disclosure. So the answer I would hope is an absolute yes.
Indeed, as it has been since we've known you, Mark, because of course VSA has been having the same information and I can assure everyone listening on this call that both Hannam & Partners and VSA have a very, very good close relationship with the company and have for all the information we have ever asked for.
It's been a very helpful, an open and collaborative approach to actually ensuring that forecasts are out there.
Good, I'm glad to hear that, Pete.
Yeah, yeah, I'm sure, I'm sure, Hannam would respond in this, in like manner. Okay, before I ask, Mark, just to wrap up, could I ask my colleagues Brian and Dylan just to set up the refreshments in the side room? Thanks to everyone attending online. I'm going to ask Mark just to wrap up now, and thanks for everyone attending here. Mark, do you want to just have some closing remarks?
Yes, well, thank you everyone for attending today, coming in person or attending online. My desire is to communicate with shareholders and to make sure that we keep everyone happy, and I will answer as many questions as best I can, as fulsome as I can.
My intention is to grow this company further, and I want to do it in a fair and cost-effective manner. I think we're achieving some good success on that basis. It takes time. I have done it before. I've grown several companies before and made them much larger than they were when they started. I'm hoping Prospex is going to be another one. So watch this space. I ain't finished yet.
Thank you very much, Mark. Thank you everyone for attending.