Weekend reports in the Times and Reuters that Desire Petroleum 's Liz 14/19 exploratory well in the North Falkland Basin was unviable were confirmed this morning in a statement by the company. The well is the first to be drilled in the North Falklands Basin in over a decade and has caused international tension between Argentina and the UK.
The primary Liz target was reached at a depth of 2550m and showed indications of hydrocarbons but reservoir quality was described as poor. Drilling continued to depths of 3570m and further logging is underway to evaluate the signficance of the hydrocarbons and deeper gas shows encountered.
Until the logging is complete and the results analysed it will not be possible
to determine the significance of the hydrocarbons encountered and whether the
well will need to be drilled deeper, suspended for testing or plugged and
abandoned
A full announcement is expected later this week when operations are complete.
Upon release from Desire's Liz prospect, the Ocean Guardian drilling rig will relocate to the Sea Lion exploration well 100% owned by Rockhopper Exploration on the western margin of the North Falkland Basin.
In early trading all the Falkland Explorers share prices slumped with Rockhopper (LON:RKH) and Desire (LON:DES) faring the worst. Rockhopper owns a 7.5% stake in the Liz prospect. Desire Petroleum's share price had fallen 50% in early trading.
