Centrica and Faroe abandon Norwegian well

TECHNICAL glitches have forced Scottish Gas-owner Centrica and Aberdeen-based driller Faroe Petroleum to abandon an exploration well in the Norwegian sector of the North Sea.

The pair – along with partners Spring Energy Norway and Suncor Energy Norge – had been trying to reach an area where they thought oil might lie close to their existing Butch exploration well.

But the shaft being drilled by Centrica became unstable and so the group announced yesterday that it had been “plugged and abandoned”.

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Faroe chief executive Graham Stewart said: “Although it is disappointing that we failed to reach the reservoir target due to drilling difficulties, we remain excited about the prospect and, subject to availability of a suitable rig, we hope to be back drilling in 2012 or 2013.

“Butch is an attractive discovery in its own right and it has de-risked several additional attractive exploration opportunities on similar prospects.”

The Butch well was drilled in October and was described at the time as “an exciting new oil play”.

Stewart highlighted the breadth of Faroe’s drilling programme in Norway this year – which includes the Clapton, Cooper, Kalvklumpen, Santana and T-Rex wells – and the North Uist well to the west of Shetland in the North Atlantic.

News of the setback with the latest well didn’t deter the City from its positive stance on Faroe, with analysts at Panmure Gordon reiterating their “buy” recommendation on the stock.

PETER RANSCOMBE

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