Falklands’ oil explorer Rockhopper said the latest well in its controversial drilling campaign in the South Atlantic Islands has come up dry.
Rockhopper Exploration said the 14/10-8 well, designed to look for further oil at its Sea Lion complex, as well as at its Casper and Kermit prospects, found 123 metres of oil but the sands were also water-logged.
The thickness of the reservoir encountered in the well has increased the company's confidence that good quality reservoir is likely to be present in other relatively low amplitude areas within the Sea Lion main complex, Rockhopper said in a statement on Tuesday.
The company increased its resource estimates for the Sea Lion complex on the back of this new data, rising by 19% to 1.3 billion barrels in the mid-case.
Whilst the 14/10-8 result is disappointing, the increase in the in-place resource in the main structure is positive for the commercial development of the field, said analysts at Evolution Securities.
Rockhopper is trying to raise funds to support a 2 billion dollars project in the area but will need to prove there is sufficient viable oil to justify investment.
The well will now be plugged and abandoned and the Ocean Guardian rig will move to drill another well, located approximately 5.9 kilometres to the south west of the 14/10-2 discovery well, the company said.
“The well is designed to investigate reservoir presence and hydrocarbon charge within the SLMC towards the southern edge of the Company’s acreage and is also an exploration well on the Eastern side of the Casper prospect”, said the company’s release.
“The 14/10-8 well has provided us with further valuable information regarding Sea Lion although its main targets proved to be water wet. We continue to make progress in refining our view of the field’s full potential and the optimal ways to both finance and develop it” commented Chief Executive Sam Moody.
Rockhopper shares closed at 171 pence on Monday, valuing the company at around 442 million pounds (693 million dollars).