Longboat Energy PLC (AIM:LBE) shares dropped around 14% in Friday’s early deals after the company reported that a previously proposed appraisal well at the Egyptian Vulture light oil discovery will not presently proceed.
The project, in the Norwegian North Sea, is located in the vicinity of infrastructure and has a wide estimate of potential resources, between 4mln and 68mln barrels oil equivalent.
Longboat in a statement said that for an appraisal well to be successful it would need to encounter better reservoir quality than that penetrated by the previous discovery well, and the joint venture partners in the project “have been unable to form an aligned view” for a well plan.
The joint venture partners did not commit to the next licence extension, required by 2 March, and the licence has now been relinquished.
Longboat said it now plans to form a new group to take the asset forward and plans to re-apply for the acreage in the forthcoming licence round with awards due in January 2024.
"The Egyptian Vulture discovery has significant upside and needs an aligned partnership to be efficiently appraised and progressed to a potential development project,” said chief executive Helge Hammer.
“We look forward to creating a new group to take this high-potential asset forward."