Longboat Energy PLC (AIM:LBE) investors were not wowed with the results of testing at the Oswig condensate discovery in the Norwegian North Sea, as the firm's share slumped by more than 25% in Thursday’s early deals.
Testing of Oswig proved the ability to flow from poor quality reservoir, with rates measuring around 650 barrels oil equivalent (boe) per day after a ‘mini frac’, the company said.
Oswig can be a viable development via a hook-up to existing nearby infrastructure, it added.
In light of the well test results, the company gave a preliminary estimate of recoverable resources which are pitched in the range of 10mln and 42mln boe – from some 100mln to 215mln boe of ‘in-place’ barrels.
The company noted that some ‘significant upside’ remains in a potential southern extension to the discovery, though these possible volumes are not included in the estimate.
“Longboat is pleased to have made a discovery at the Oswig well, albeit at the lower end of pre-drill expectations,” said Longboat chief executive Helge Hammer in a statement.
Hammer added: "The Oswig fault block drilled has substantial volume potential and is located close to existing infrastructure. In addition, there is a possible large extension towards the south in the same fault block.
“Longboat looks forward to working with the partnership to define an appraisal programme and optimal well configuration for maximising flow rates from future potential development wells."
In London, Longboat shares dropped 12.54p or 26% to trade at 34.96p.