The oil explorer Rockhopper moved a step closer to demonstrating the commerciality of its Sea Lion oil find off the coast of the Falkland Islands after it said an appraisal well flowed at a strong rate.
Rockhopper is one of a number of firms drilling in waters off the coast of the islands. Questions have been asked about whether there are sufficient quantities of viable oil to justify investing in infrastructure.
"This very positive well test result is another key milestone in establishing Sea Lion commerciality," said the chief executive, Sam Moody.
The company said an appraisal well on the Sea Lion discovery it made in 2010 flowed at a stabilised rate of 5,508 barrels per day, higher than the 2,700 barrels per day potential identified by another well in the same area in April.
The flow rates achieved are viewed as being commercially viable, said Rockhopper, adding that the rig will now move to drill a third appraisal well within the Sea Lion area.
Shares in Rockhopper, which have risen 29 per cent in the last month, opened up 10 per cent before retreating to end the day down 4 per cent at 260.9p.Reuse content