Heritage cranks up oil output

Exploration and production firm Heritage Oil saw a 71% increase in the number of barrels of oil produced per day (bopd) between 1 July to 15 November compared to the same period a year ago.

The firm generated an average of 882 barrels of oil per day due to a successful horizontal well which was completed in August 2011. The horizontal well is the first such well drilled in the immediate area and presents a more effective and efficient method to develop the field, the firm said.

The company has a strong balance sheet with cash of around $353m as at 30 September, although this excludes the $405m related to the tax dispute with the Government of Uganda.

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During the period the firm acquired a 51% equity interest and control of Sahara Oil Services which holds the necessary long term permits and licences to provide oil field services in Libya.

Heritage's Miran West-3 well, which began drilling in August 2011, has reached 1,576 metres and is drilling ahead after the successful testing of the Upper Cretaceous oil reservoir in October 2011. A rig has been contracted to drill Miran East commencing in January 2012.

Chief executive officer Tony Buckingham said: "We are making great progress across the portfolio and we have a strong balance sheet to pursue these programmes whilst also considering further opportunities."

The share price rose 0.57% to 193.1p by 09:14.

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