Cairn Energy announced that Agora Oil and Gas, a firm it is set to buy, has struck oil at its Skarfjell Prospect in the Norweigan North Sea.
The well found very good quality upper Jurassic reservoir sandstone containing light oil over a 168m gross interval, it said.
Due to ongoing rig schedule commitments the well was not tested but extensive data acquisition and sampling had been carried out, Cairn added.
Subscribe to MoneyWeek
Subscribe to MoneyWeek today and get your first six magazine issues absolutely FREE
Sign up to Money Morning
Don't miss the latest investment and personal finances news, market analysis, plus money-saving tips with our free twice-daily newsletter
Don't miss the latest investment and personal finances news, market analysis, plus money-saving tips with our free twice-daily newsletter
Svein Ilebekk, Chief Executive of Agora, said the discovery highlighted how important the prospective deal with Cairn could be.
"Cairn's size and strength will help us support the development and production of Skarfjell, should that ultimately prove to be the most attractive way of realising value from this discovery," he said.
However, it was a mixed announcement as the firm also revealed that Agora had been forced to abandon its Cladhan South exploration well in the UK Northern North Sea.
Operational difficulties meant that no further progress could be made, it said, but it drilling had revealed no evidence of hydrocarbons anyway.
Early in April Cairn announced it was to splash out on Agora, which is owned by Lord Rothschild's Investment Trust (RIT).
The $450m deal will see Agora adding extra drilling activity to Cairn's 2012 exploration and appraisal programme, with nine wells scheduled to be drilled in the UK and Norway this year.
Cairn said the acquisition would result in it having "a more balanced overall business", by adding lower risk, near term exploration, appraisal and development assets to its "frontier exploration" in Greenland and the Mediterranean.
Cairn has struggled recently with its Greenland exploration, recently announcing that it racked up a $1.19bn loss in 2011.
The Agora deal will result in a windfall for the RIT, which invested £41m in the firm in 2009.
RIT said its anticipated cash proceeds from the transaction would be £114m - a profit of £73m in just over two years.
-
FTSE 100 hits record highs – why is it rising and will we see more gains?Advice UK equities have been described as unloved for a long time but as the FTSE 100 hits new highs, we explain if now is the time to buy British.
-
How to invest in copperIt may be time to invest in copper as the red metal appears poised for a big jump. Dominic Frisby looks at what should investors should buy
