Stebbing abandoned by Borders & Southern

Investors were given a brutal reminder as to the high-risk characteristics of exploration in the South Atlantic after the share price of Borders & Southern Petroleum collapsed on news that it had plugged and abandoned its Stebbing well in the South Falkland Basin. The news wiped over £200m, or 69 per cent, off the market valuation of the oil and gas explorer, with the company's share price plunging to 19.5p, its lowest level since global petroleum prices bottomed out in March 2009. The announcement would have come as a particularly bitter blow to shareholders who participated in April's £46.5m cash call, in which shares in Borders & Southern were sold at 84p apiece.

Borders & Southern failed to reach the primary deep exploration targets at Sebbing and was forced to abandon the well at 3,060 metres due to "anomalous pressure conditions". The company endeavored to put a put a positive spin on the news by revealing that "very strong" gas flows had been encountered in the upper Tertiary target, but essentially the well is a busted flush.