Austrian E&P company RAG buys Hungarian operation of Toreador Resources
Thursday, October 1, 2009 10:10:00 AM

Austrian oil and gas company RAG has acquired the Hungarian operation of Toreador Resources it has been closely working together with for two years before it indicated its intention to buy the unit.

Toreador Resources has already been considering opportunities to monetize its Hungarian operations and portfolio to enable the company to expedite development of the Paris Basin Shale Oil.

Exploration and production company RAG is convinced that there are unexplored oil and gas reserves in Hungary.

Toreador Hungary operations (source: Toreador Resources):

Toreador operates the Balotaszallas-E-1 ("Ba-E-1") well in the Tompa block in southern Hungary. The well, which was the first in the basin to be fracture stimulated, was drilled to a final total measured depth of 3,620 meters, successfully encountering the target geologic horizon as a 560 meter gross over-pressured section. The well has since been completed and an initial fracture stimulation program has been executed over the two lowermost intervals in the well.

About RAG

Rohöl -Aufsuchungs Aktiengesellschaft (RAG) is the longest-standing exploration and production company in Austria. Since the discovery of oil and gas by RAG in the Vienna Basin in 1937, the company has produced over 14 million tons of crude oil and over 23 billion cubic meters of natural gas. Today, RAG's annual production stands at around 750 million cubic meters of natural gas and 120 000 tons of crude oil.

In order to meet the demands of the market, the company has, in addition to its gas trading activities, been operating underground gas storage facilities (holding a working gas volume of some 700 million cubic meters in Austria) for more than 20 years.

In recent years, the concession fields of RAG have been extended to cover in excess of 8,200 square kilometres, of which about 60% is located in Austria and around 40% in neighbouring Bavaria. RAG is an international leader in the field of technology, safety and environmental standards. It has 400 employees in Vienna, in Lower Austria, Upper Austria and Salzburg. The company invested around EUR 180 million in new projects in 2009.

RAG has a nearly 30-year history in natural gas storage, as well. It operates the second-largest gas reservoir in Central Europe.

RAG discovered the Haidach gas reservoir in 1997 as a porous sandstone reservoir located at a depth of 1,600 meters. Holding a total gas in place of 4.3 billion cubic meters, the Haidach reservoir was the largest gas find in Austria since 1982.

Since production started in 1998, more than 2.9 billion cubic meters have been produced for the Austrian market.

RAG, WINGAS GmbH and OOO GAZPROM EXPORT officially opened the underground gas storage in Haidach, Salzburg/Upper Austria in April 2007. The second stage of the project was initiated at the end of 2008 and is scheduled for completion in April 2011. The total capital expenditure for both project stages of the Haidach underground gas storage facility amounts to EUR 250 million. As concession holder, RAG will construct and operate the storage facilities. The capacity of the Haidach storage facility is to be 2.4 billion cubic meters of natural gas, doubling Austria's storage capacities. The projected storage volume represents around 25% of the country's total annual gas demand.