Caspian Sunrise said in a statement that the A5 well had yielded a rate of 3,500 barrels of oil per day in testing. The well was tested for 4 hours before being shut-in pending further testing with high-pressure equipment.
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The AIM-quoted share shot up around 60% at just over 14p in Monday morning deals.
WH Ireland analyst Brendan Long, in a note, highlighted that pressure dynamics information suggests ‘excellent fluid communication’ between the A5 well and a ‘highly productive reservoir’.
“This is the moment we were waiting for and the production result materially exceeds the success case guidance of 2,000 b/d previously provided by the company,” Long said.
He added: “Since relaunching itself under the name Caspian Sunrise, pursuant to a merger with Baverstock to consolidate a 99% operated interest in the BNG licence, the company has been on a tremendous growth trajectory in terms of the creation of shareholder value.”
WH Ireland this morning repeated a ‘buy’ recommendation and upgraded its price target to 28.6p per share from 22.2p, implying almost further 100% upside to Monday’s newly elevated price of around 14p.