MedOil plc, the oil and gas exploration company, has signed an agreement for a one-year exploration study of Maltese waters - and the company believes the chances of striking black gold are good.
The study would focus on an area off northern Malta near the maritime boundary with southern Sicily, not far from the giant Italian Vega oilfield.
The company will spend the time reprocessing existing seismic data and the study can be extended beyond a year. The company reckons the study will cost about £120,000.
The agreement was signed with the Maltese government last Tuesday though details only surfaced yesterday. The application was submitted to the government in October but EU membership meant it had to be gazetted, delaying things in the process.
"We've already identified three quite sizeable structures in this area of about 20 sq km in aerial extent, which really look quite interesting," David Thomas, an executive director of MedOil said. The three structures lie in waters about 200 metres deep.
Contacted by The Times, MedOil director Joseph McKniff said he believes there are "good leads" in the area earmarked for exploration, even if successive attempts in the past to find oil in the vicinity of Maltese waters have failed.
Mr McKniff said it stands to reason from the existing seismic data available to MedOil why certain explorations in the past yielded nothing.
"We see encouraging changes and developments even if two geologists can give you different interpretations of a particular area. We believe the chances are good," he said.
MedOil officials have visited Malta several times and spent a week here last Autumn "checking existing data".
Other projects across the Mediterranean region are being examined, including four offshore projects and three projects onshore North Africa.
MedOil plc, which is listed on the Alternative Investment Market, has already been awarded, in partnership with seismic outfit TGS-NOPEC, a two-year prospecting permit for the El Louza Block offshore Tunisia.
Exploration activity in Malta was triggered by the discovery of oil in Triassic dolomites in 1953 at Ragusa in nearby Sicily.