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Tullow shares sink after delay in new drilling revealed

SHARES in Tullow Oil plunged this morning after the company said drilling at a well in Ethiopia would be delayed.

In a statement, Tullow said it was having issues with keeping the Sabisa-1 well stable and that initial results were unlikely before the end of May – later than expected.

Tullow’s exploration director Angus McCoss said the well had proved to be “technically challenging” so far.

“This is often the case in frontier basins, and the well now requires a side-track to redrill, log and sample the objective section. Nevertheless, we are encouraged by the hydrocarbon indications which provide emerging evidence for a working petroleum system in the previously undrilled South Omo Basin”.

Elsewhere, Tullow said the first of the Ngamia-1 wells in Kenya flowed at 281 barrels of oil per day.

Mr McCoss said that result was “very encouraging and prove the first potentially commercial flow from the Lower Lokhone reservoir section”.

“The remaining tests in the Auwerwer reservoir units will give us a fuller indication of Ngamia’s production potential,” he added.

By 11.30 Tullow shares were down 5.3pc at 1,098 pence.

Online Editors