Faroe Petroleum shares drop as it abandons well in Norway

Faroe Petroleum's shares fell Monday after the oil and gas company said it failed to encounter hydrocarbons at its Darwin exploration well in Barents Sea, Norway.

The well, which was the first to be drilled in the Norwegian Barents Sea licence, was declared dry after it recorded no hydrocarbons in the Cretaceous reservoir.

It has been plugged and abandoned after being drilled to a total depth of 2,542 meters at the lower section of the reservoir.

Data has been collected, including wire-line logs, pressure and side-wall cores and a full formation evaluation is underway.

"It is disappointing that no hydrocarbons were present in the Cretaceous section at this location, however it does provide important new data and information which will allow further evaluation and de-risking of this extensive licence in the Barents Sea province in which Faroe has a strategic position," said Chief Executive Graham Stewart.

"Looking ahead, Faroe's extensive and diversified northern seas portfolio is delivering an exciting, fully funded exploration and appraisal drilling programme for 2013 and beyond."

The company has five further wells planned with three exploration wells scheduled in Norwegian waters on Snilehorn, Novus and Butch East.

RD