LONDON (Alliance News) - Rockhopper Exploration PLC and Falkland Oil and Gas Ltd Tuesday said that a sand interval with suspected elevated formation pressure and oil shows had been penetrated in the Isobel deep well that was started by Premier Oil PLC in early April, and Premier has decided to set a cement plug over this interval and run an additional casing string before drilling ahead through the main reservoir target to total depth.
FTSE 250-listed Premier Oil operates the Isobel Deep well of the Falkland Islands with a 36% stake, while Falkland Oil and Gas Ltd holds a 40% stake and Rockhopper Exploration holds the balance. In late April, the companies encountered a problem with the blowout preventer which led to the well being "temporarily" suspended so it could be inspected and repaired and drilling restarted earlier this month.
Rockhopper and Falkland Oil and Gas said Tuesday that the scenario to run a contingent casing string in the shale section above the sand interval that has now been hit was expected and the additional casing required was already on the rig. They said the additional work will add about 10 to 15 days to the schedule and final results are now expected in early June.
"The presence of oil shows is not necessarily indicative of net pay and conclusive results for the well will not be available until drilling operations have been completed and logging data collected," Rockhopper said in its statement.
Falkland Oil and Gas said the additional work will have no financial impact because it is fully carried through the costs of the Isobel Deep well by Premier Oil and Rockhopper Exploration.
Rockhopper also gave an update on its interests in the Mediterranean.
At Guendalina, in which Rockhopper has a 20% interest, a planned acid wash on the short string has been completed and has resulted in a gross production increase from 18,000 standard cubic metres a day to 75,000 from that string. Overall gross production from Guendalina is currently about 190,000 standard cubic metres a day, of which about 38,000 is net to Rockhopper equivalent to approximately 223 barrels of oil equivalent a day.
The planned sidetrack to the GUE2 well at Guendalina is due to take place during the summer, it added.
Additionally, the Environmental Impact Assessment of the Ombrina Mare Field Development Plan has been approved by the Minister for the Environment in Italy, and now needs signing by the Ministry of Cultural Heritage and then the Ministry of Economic Development in order for the Minister to be in a position to award the Field Production Concession, said Rockhopper, which owns the project outright.
At Civita, which Rockhopper also owns outright, the company has started construction and said it is on track to draw first gas by the end of 2015.
Rockhopper shares were up 1.2% at 62.75 pence Tuesday morning, while Falkland Oil and Gas was down 4.3% at 29.18p. Premier Oil shares were down 2.6% at 166.50p.
By Steve McGrath; stevemcgrath@alliancenews.com; @stevemcgrath1
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