Desire Petroleum saw its shares dive yesterday after it said an exploration well on the Rachel prospect was dry.
The oil and gas company wholly focused on the North Falkland Basin said initial wireline logging showed no hydrocarbons had been found, although the well had provided valuable new data on the distribution of the reservoir targets within the area.
Desire added that, based on the latest information from the well, potential oil-bearing sandstones had been identified close to the existing location. It said: “As a result the well will be sidetracked to this location to evaluate the prospectivity. The sidetrack will start when the present logging operations are complete.
“The sidetrack is expected to take 20 days and the company will make a further announcement on completion.
“The Rachel well is the first in a likely four-well drilling campaign operated by Desire. Following the sidetrack it is intended to move the rig to the Dawn/Jacinta prospect.”
Desire has 92.5% of Rachel and fellow British explorer Rockhopper, also 100%-focused on waters off the Falkland Islands, has 7.5%.
Shares in Desire fell nearly 36% to 70.5p while Rockhopper’s shares ended the day 14% lower at 293p following the news.