Global Petroleum says it is somewhat “insulated” from the Italian government’s new bill suspending oil and gas operations because of a long-running legal battle it is caught up in.

The Italian Parliament this week passed a bill to suspend oil and gas operations for 18 months while it assesses the suitability of areas for sustainable exploration and production.

“The publication by the Italian government of a clear hydrocarbon plan would be a welcome development for all operators in the region although the coming 18 months is likely to be an uncertain period for the industry,” chief Peter Hill said.

“We are, to an extent, insulated from much of it pending the appeals process on our applications and our objective will be to bring this court process to a satisfactory conclusion before the end of the moratorium on exploration activities.”

In August 2013, Global submitted an application, proposed work program and budget to the Italian Ministry of Economic Development for four exploration areas offshore Italy.

The areas are located in the Southern Adriatic abutting Croatia, Montenegro and Albania.

Global Petroleum (ASX:GBP) shares over the past year.
Global Petroleum (ASX:GBP) shares over the past year.

The Italian government published the environmental decrees for two of the areas in October 2016 and the other two areas in October 2017.

The publication of environmental decrees is the final administrative stage before the permits are granted.

But various local authorities and interest groups appealed against the environmental decrees for all four areas.

A total of seven parties filed appeals with the Tribunal against the 2016 decrees and nine filed appeals against the 2017 decrees.

Several of the appeals were rejected in October and November last year, but some of them filed further grounds for appeal.

Those appeals are scheduled to be heard in the first quarter of this year.

Global Petroleum says it is confident that the remaining appeals will be rejected as well.

Recent appeals against other environmental decrees in the Southern Adriatic had been rejected by the same Tribunal, the company said.

“We still believe that the permits we have applied for contain good prospectivity and we remain of the view that in time our Italian assets could provide material upside for our shareholders,” Mr Hill said.

In the meantime, Global Petroleum plans to focus on its Namibian acreage.