Hurricane Energy PLC (LON:HUR) shares advanced in Thursday’s early deals thanks to positive well results from the Greater Warwick Area.
The British offshore oiler this morning revealed that the Lincoln Crestal well had flowed at rates of up to 9,800 barrels of oil per day in testing.
That peak rate was achieved with the use of electrical submersible pumps while under natural conditions the well flowed an average of 4,682 bopd.
Lincoln Crestal is the second of three wells being drilled in the Greater Warwick Area, which neighbours the now producing Lancaster field.
It was drilled down to a depth of 1,780 metres and cut a 720-metre horizontal section of fractured basement reservoir. The well is now being suspended with the intention that it will be used in the future for production.
A tie-back to Lancaster’s Aoka Mizu FPSO – floating production, storage and offloading – vessel is now planned during 2020 subject to further work, regulatory consent and financing.
The Transocean Leader semi-submersible rig will subsequently move on to the third and final well in the current programme, ‘Warwick West’.
Hurricane chief executive Robert Trice, in a statement, said: "We are delighted with the results of the Lincoln Crestal well”.
“We have confirmed the presence of light oil which can be produced at commercial rates.
“The Lincoln Crestal well is now planned to be tied back to the Aoka Mizu FPSO next year. This would make Lincoln the second producing basement field in the UK.
"Based on the result of the 2016 Lincoln well, RPS Energy assigned 2C contingent resources of 604 million barrels of oil equivalent to Lincoln. This successful result brings us closer to monetising this huge resource."
Hurricane shares rose by 4.13p or 9.12% to trade at 49.43p.
Tim Hurst-Brown, analyst at Mirabaud, in a note described a “solid” well result.
“The well was targeting the structure lying to the north east of the core Lincoln field, and on test flowed at maximum rates of 9,800 barrels per day,” Hurst-Brown added.
“The headline rate looks slightly lower than previous wells on Lancaster (205/21a-7 flowed at 14.5 kbopd), however the horizontal section of 720 metres was shorter than the 1km section at well 7, implying a commercial result broadly consistent with previous wells.”
Elsewhere, oil companies expert Malcolm Graham Wood, in his daily blog, said it was a “cracking discovery”.
“This is another excellent result for Hurricane, it is another commercial discovery and will be tied back to the Aoka Mizu,” he highlighted.