Tuesday, November 27th 2012 - 22:18 UTC

Mixed bag for Noble Energy: oil in Gulf of Mexico and plugged well in the Falklands

Noble Energy Inc. (NBL) unveiled a discovery in the Big Bend exploration area in the Gulf of Mexico as it also abandoned another well off the shore of the Falkland Islands that yielded a low-quality reservoir.

Charles D. Davidson, Noble Energy's Chairman and CEO, said, ”The discovery at Big Bend is an exciting follow-up to our recent success at Galapagos.

The results come as Noble shuffles its portfolio to focus on higher-profit areas. The Houston-based oil and gas producer has been selling its non-core assets to focus its spending on horizontal drilling operations in the US and offshore projects in Gulf of Mexico, the Mediterranean, and offshore West Africa.

The nearly 16.000-foot-deep well in the Gulf of Mexico's Big Bend area, which is located in 7.200 feet of water, has roughly 150 feet of net oil pay, Noble said. The Houston-based exploration and production company has a 54% working interest in the project, with W&T Offshore Inc. (WTI) holding another 20% stake.

Meanwhile, Noble said a deepwater well in the Scotia area off the coast of the Falklands revealed about 164 feet of low quality reservoir. The operator, Falklands Oil & Gas PLC, plans to plug and abandon the well, according to Noble.

As a consequence of the plugged well Falkland Oil & Gas PLC lost almost half of its value. The disappointing statement wiped 49% off FOGL volatile stock, sending its shares to an historic low of 51 US cents giving it a market value of 165 million dollars.

The stock price had hit a high of 4.28 dollars in July 2010.

FOGL, which is partnered with US firm Noble Energy and Italian utility Edison on the project, said a reservoir at its Scotia exploration well appeared to be of poor quality, with low permeability.

The collapse in the shares, however, came despite an insistence from the firm that it remained upbeat on its campaign, with further tests set to determine whether there was a higher quality reservoir elsewhere in the region.

“Today's much anticipated well results will come as a disappointment for investors in FOGL, following their gas find at the Loligo prospect in September,” analyst Sam Wahab at Seymour Pierce said.

“The recent rally in the company's share price was in market expectation of an oil discovery, and on this basis we would expect FOGL's shares to fall this morning.”

Gas, which has been found off the Falklands by Borders & Southern and FOGL at its Loligo well to the south of the Falkland Islands, is harder to extract and transport than oil.

Oil was found to the north of the Falklands in 2010 by Rockhopper Exploration, which has enlisted Premier Oil to fund development, while Desire Petroleum also confirmed the positive potential of its licence in the North Malvinas basin last week.

20 comments Feed

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1 Pirate Love (#) Nov 27th, 2012 - 10:31 pm Report abuse
Well at least there is gas, better to have the resources and retrieve them then to have the resource and not have the means, isnt it argentina??
and with the latest fitch downgrade things are about to get even harder for the Crustina reich :))) what a shame!
2 slattzzz (#) Nov 27th, 2012 - 10:43 pm Report abuse
It' s only one well as far as I understand plenty more to look at and the Rockhopper one in the North Basin is defo a goer I believe
3 Pirate Love (#) Nov 27th, 2012 - 10:51 pm Report abuse
@2 fingers crossed, even with this not so great news, nothing could be worse than the news argentina has just recieved in the past half hour, talk about bad timing.
4 Lord Ton (#) Nov 27th, 2012 - 11:09 pm Report abuse

5 ProRG_American (#) Nov 27th, 2012 - 11:17 pm Report abuse
Just move on. You were not meant to find any. It will be up to the Argentines to exploit their oil when it is finally found in the future.
6 Pirate Love (#) Nov 27th, 2012 - 11:38 pm Report abuse
@5 Its possible, however,only when argentina has agreed a deal with F.I.Govt to explore for oil within The Falklands territory, but that is in a far flung future, if at all.

7 puerto argentino (#) Nov 28th, 2012 - 12:41 am
Comment removed by the editor.
8 Bongo (#) Nov 28th, 2012 - 12:42 am Report abuse
“You were not meant to find any.”

First the Malvinistas claim the whole world is on their side. Are they now claiming God is too?
9 Troy Tempest (#) Nov 28th, 2012 - 12:51 am Report abuse

Oh, dear.

Shouting will not help. Mummy is not going to come running. It's still the same answer - you cannot have a pony.
10 Bongo (#) Nov 28th, 2012 - 01:17 am Report abuse

But the islanders ARE exercising self-determination.

11 Nostrolldamus The 2nd (#) Nov 28th, 2012 - 02:04 am Report abuse
Well, I really don't care either way if there is oil or not there, of course good for the locals if there is.

HOWEVER, this news does seem like a slap from above to the BIG-MOUTHED Brits on this board (interestingly, I haven't seen many falkanders with as big a mouth).

They were all talking about how the Falklands were going to buy Argentina when the oil started flowing... I guess it maybe a good idea to follow the cardinal rule that states “don't speak too soon?”
12 CJvR (#) Nov 28th, 2012 - 02:21 am Report abuse
Ah well, I suppose they have to make due with the previous finds.
13 Marcos Alejandro (#) Nov 28th, 2012 - 04:04 am Report abuse
D U S T E R :-)))
14 Bongo (#) Nov 28th, 2012 - 08:57 am Report abuse
So Marcos, there can be no theft of Argentina's resources - as Malvanistas claim - since there are no resources to steal, right?
15 briton (#) Nov 28th, 2012 - 02:28 pm Report abuse
They were all talking about how the Falklands were going to buy Argentina when the oil started flowing

just like argies nuking the human race,

its a joka, you know whata joka is dont you .lol.
16 Anbar (#) Nov 28th, 2012 - 07:15 pm Report abuse
“”“”“” I guess it maybe a good idea to follow the cardinal rule that states “don't speak too soon?”“”“”“”

..but.... you just broke that ....? eh? wtf?

arf arf

- - -

seriously, as I posted elsewhere: anybody who bets on oil exploration is betting on a bucking bronco on acid....

until its actually pumping commercially, I wouldn't go running my mouth off about it. ..or what its going to do.

Not too mention that in most situations where a small population gets access to a large oil/gas revenue... it doesnt always turn out that well in terms of general society.

(Still, I wish this guy would stick to just one account rather than using many... his points would carry a lot more weight than constantly being spouted via various sock-puppets)

on which subject tobias/nostro/BK/guzz*whoever*.... I think it is fair to say that the loud mouths on any side should always learn to keep their gobs shut more often... dont you think>?

More fool the person who thinks they are representative of course. ¬_¬
17 British_Kirchnerist (#) Nov 28th, 2012 - 11:10 pm Report abuse
Oh dear, maybe it would be better to team up with Argentina after all, you might be better able to find the oil if you do...
18 cuen_89 (#) Nov 29th, 2012 - 07:05 pm Report abuse
that old briton keep acting like a stupid child
19 Furry-Fat-Feck (#) Nov 29th, 2012 - 09:47 pm Report abuse
“Oil was found to the north of the Falklands in 2010 by Rockhopper Exploration, which has enlisted Premier Oil to fund development, while Desire Petroleum also confirmed the positive potential of its licence in the North Malvinas basin last week.”

Oh well. I suppose two oout of three aint bad.
20 Argie (#) Nov 30th, 2012 - 02:18 pm Report abuse
All of us know that oil explorers always lie about the likelihood of finding a Paradisiac Well, peppering the TV with news of the promising area they were allocated.

This is to catch investors, as greed is one or perhaps the main motive to join in this risky business.

Shares are better bought from petrol companies that earn good money every day. Dearer, but sure enough.

Let explorers use their own resources and they'll stop drilling unless they have 99% chances of finding a productive well.

I remember gold exploration turned out a few small nuggets. Then garnet came in. No luck.

I'm sorry for my island friends who fell in the explorers' trap.

Tourism is better. Pave a few more roads and money will rain into your local accounts. Leave Rockfu**er alone.


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