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Serica Energy shares dip as Rowallan well disappoints

Published: 08:33 04 Apr 2019 BST

oil and gas operations
The well will be plugged and abandoned

Serica Energy plc (LON: SQZ) shares dipped in Thursday’s early deals after a disappointing outcome of the Rowallan exploration well in the North Sea.

The Rowallan well was drilled down to a depth of 4,641 metres and after an unsuccessful result, it will now be plugged and abandoned. It encountered a 182-metre section of sandstone and shale that was not found to be hydrocarbon bearing.

"We are naturally disappointed that the well has not encountered hydrocarbons,” said Mitch Flegg, Serica chief executive.

“We will now assess the valuable data acquired before deciding the forward plan for the remaining prospects on block 22/19c and adjacent blocks.

“This result justifies our policy of reducing financial exposure to exploration risk by means of farm-out.

“In this case, we were fully carried and did not pay anything towards the cost of the well. We remain fully committed to building on our balanced exploration, development and production portfolio."

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