(Alliance News) - Empyrean Energy PLC on Friday said its loss ballooned to nearly USD21 million after its Jade drilling programme ended in failure, but is pressing ahead with work at the "robust" Topaz prospect.
Shares in the oil and gas development company were down 2.5% at 0.73 pence in London on Friday afternoon.
Empyrean, which has interests in China, Indonesia and the US, reported a USD20.8 million pretax loss for the year ended March 31 compared with its USD8.1 million loss the year before.
Empyrean incurred no revenue in either year. Its basic and diluted loss per share widened to 2.71 cents from 1.43 cents.
Empyrean previously had announced in late April, 2022 that drilling at the LH 17-2-1 Jade well at its Block 29/11 permit in offshore China had ended with no oil pay encountered in the target reservoir.
As a result, Empyrean incurred a USD17.0 million impairment against prospect and dry hole costs associated with operations at Jade, up from USD4.1 million in impairments the previous year.
Total expenses surged to USD17.8 million from USD7.7 million. Finance costs also increased to USD3.0 million from just USD420,000.
However, Empyrean said post-well studies of the Jade evaluation work "confirmed excellent reservoir quality," and that oil migration pathways have positive implications for the nearby Topaz prospect.
Empyrean had said in June 2022 that it would enter the second phase of exploration and drilling at Topaz. On Friday it reiterated its aim to commence drilling before June 2024.
Chief Executive Officer Tom Kelly commented: "Following the disappointing result at Jade...Empyrean's post well analysis has been able to combine our excellent quality 3D seismic data with the confirmed well data from Jade to improve the validity of the Topaz prospect as a robust and large drilling target of approximately 891 million barrels in place."
Drilling at Topaz, he added "in itself could be a transformational result for Empyrean and its shareholders."
By Emma Curzon, Alliance News reporter
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Empyrean (EME)