MTA.L Share News (MTA)

Matra, an oil and gas exploration and production company, saw its share price take a huge tumble on Wednesday after reporting that it has had to shut-in a well at its Sokolovskoe Field site in Russia. Well-12 had experienced a build-up of wax in the tubing and an increase in water means the well has ceased to flow.An independent review of the status of well-12 concluded that the water may be flowing behind the production liner from overlying formations and recommended acquisition of further data in order to identify the source of the water before attempting a remedial work-over.The company said: "Following the review, the directors have sourced a work-over rig (expected to be on site on 17 August) that will allow the company to pull and clean the production tubing and then to artificially place the well into temporary production, using nitrogen. This will also allow production logging over the entire liner interval and into the production casing and will provide the best opportunity to identify the source of the water production. "Following production logging, a pressure survey will be conducted before deciding on the viability of further remedial work on the well." A separate well was also shut-in after water-free oil production was established, while analysis of the well showed that it could produce around 100 barrels of oil per day if it is installed with specialist equipment. "A firm decision to install this equipment has not yet been made," said the company. "The directors expect that its installation will enable the well to generate a positive cash flow after the deduction of production taxes and other costs. The directors have taken the decision to await the results of the well-12 work-over before committing to this expenditure." Managing Director, Peter Hind, said: "The continuing problems at well-12 are frustrating. We are, however, continuing efforts to obtain further information from the well and to see if we can continue production. Importantly, given that the well is low on the mapped structure, it is not key to the overall development of the field." The share price was down 31.58% to 0.97p at 13:40. NR