Lochard Energy Group falls on well blockage

North Sea explorer Lochard Energy Group fell in early trading on Monday after its partner, Ithaca Energy, said one of its wells on the Athena site was blocked and not producing oil.

Operator Ithaca said only three of its four production wells on the Athena field were flowing due to a suspected downhole restriction in one of them.

Lochard holds a 10% stake in the operations.

Start your trial of MoneyWeek today

Get unparalleled financial insight, analysis and expert opinion you can profit from.

Start your trial

Sign up for MoneyWeek’s free twice-daily newsletter.

Join more than 165,000 subscribers and keep yourself informed with latest financial news, insights and expert analysis to help you understand what really matters when it comes to your finances.

Join more than 165,000 subscribers and keep yourself informed with latest financial news, insights and expert analysis to help you understand what really matters when it comes to your finances.

Sign up

Ithaca said testing had shown that there were no issues with the integrity of the well or performance of the reservoir in the area of the field drained by the well.

"The changeable flow rates achieved from the well during testing indicate that the restriction is likely attributable to a blockage in the production tubing located within the well," the firm said.

"Diagnostic work is ongoing to identify the nature of the blockage and the most effective course of action for eliminating it."

The company is currently evaluating remote intervention methods to restore the restricted well to its full

production potential.

This includes use of the existing facilities to hydraulically remove the obstruction.

However, if these methods were not successful, Ithaca said a rig-based workover could be required, which would mean waiting until the end of this year.

Lochard's price fell 10.67% to 8.38p.

NR