Premier Oil has disappointed its investors with the announcement that the Spaniards East Well in Block 15/21, in which it has a 28 per cent operating interest has been plugged and abandoned as a dry hole.
Although the well encountered 75 feet of Jurassic sands, these were shown to be water wet on the logs.
Serica Energy, Parkmead (12.624%) and Faroe Petroleum (8.4%) also each have a stake in the well. Both Parkmead and Faroe have confirmed that they will not be required to make any cash contribution to the dry-hole cost of this well.
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
Graham Stewart, Chief Executive of Faroe Petroleum, commented: "Although the Spaniards East well carried a reasonably high level of risk, we agreed to participate, given the upside potential in the event of success, and the fact the well was drilled at no cost to Faroe Petroleum."
Tony Craven Walker, Chairman and Interim Chief Executive Officer added: "There was a reasonable pre-drill expectation that the Spaniards discovery extended over a wider area and, given its proximity to existing production facilities, could therefore be commercial.
"Whilst a full analysis of the well results will be required before a final conclusion can be reached, the initial interpretation now indicates that the accumulation is likely to be confined to a more limited area around the original discovery well."
-
Who is the richest person in the world?The top five richest people in the world have a combined net worth of $825 billion. Who takes the crown for the richest person in the world?
-
Top 10 stocks with highest growth over past decade - from Nvidia, Microsoft to Netflix, which companies made you the most money?
We reveal the 10 global companies with the biggest returns since 2013. One firm has posted an astonishing 9,870% return, meaning a £1,000 investment would now be worth almost £82,000.
