Hurricane Energy (HUR) has completed logging and testing at its pilot well at the Lancaster field, and the results are very good. Preliminary third-party analysis has confirmed the presence of a significant 620m oil column, deeper than the contingent reserves case set out in the competent person's report.
What's more, flow rates look exceptionally good. A drill stem test of the reservoir provided a natural flow rate of 6,600 barrels of good quality, 38 API oil per day, or 11,000bopd using an artificial lift with an electrical submersible pump. The news, which the company said would de-risk its plans for the field and could significantly increase the resource estimate of 200m barrels of oil, sent the shares up as much as 50 per cent in early trading. The company added that the information collected so far is preliminary and will be updated following the receipt of final well data and reports.
Prior to this news, FinnCap had set a risked exploration net asset value of 50p for the Lancaster field, assuming a 25 per cent chance of field development.
