Empyrean Energy Plc (LON:EME) shares slumped despite telling investors that the Dempsey well will produce commercial gas flows.
The company said in a statement that the well is due to produce at a rate of 1.2mln cubic feet per day as a combined flow from zones 2, 3, and 4.
It expects the well to generate cash flow from the production “very shortly” and noted that multiple options being pursued to further develop Dempsey.
Next, the company intends to work on the Alvares structure in the third quarter of 2018.
"Thanks to the close proximity of existing infrastructure owned by the JV, the Dempsey Well can be connected to the sales pipeline in an expedited timeframe,” said Tom Kelly, Empyrean chief executive.
“With production of commercial gas flows at 1,200 mcf per day imminent, we look forward to reaping the benefit from this early cash flow as one of the JV partners with a 30% working interest.”
Kelly added: “Additionally, there is significant upside potential from nearby wells where plans are in place to connect four idle wells into the grid to further increase production and cash flow.
“We also look forward to providing further updates on the Alvares 1 wellbore, where Sacgasco is planning to commence activities in Q3 2018."
Empyrean shares were down 2p or 15.8% changing hands at 10.69p.