LONDON (Alliance News) - Shares plunged in Echo Energy PLC on Tuesday as it said following the completion of the CSo-2001(d) well the gas within was revealed to be "insufficient" to contribute economically to the Fraccion D gas project, onshore Argentina.
Shares in the upstream oil and gas company fell 19% on Tuesday.
The well reached a total depth of 1,511 metres in the Upper Jurassic Tobifera formation, which was reported to have gas and hydrocarbon shows in the area.
However, testing showed long term production from the adjacent Springhill formation has caused significant pressure depletion across the field's western flank, Echo said, leaving the remaining gas insufficient to contribute to the Fraccion D gas project.
Echo Energy said the depletion would not impact the Eastern flank of the Canandon Salto field, revealed to have an economically viable gas resource to the east though the testing of the CSo-85 well.
The company is now working to finalise preparations for the testing of the EMS-1001 well.
"Whilst disappointing to see the extent of the depletion effects of the Springhill formation production into this reservoir, the CSo-2001(d) well was drilled in part to help us understand the volumes to be dealt with for the gas monetisation project in Fraccion D, and phasing of that development. The focus of any plan will now concentrate on the dry gas of the Springhill Formation contained within the eastern flank of the field area to enable the right sizing of that project," Chief Executive Officer Fiona MacAulay.
Echo Energy (ECHO)