Tullow Oil Plc (TLW), the U.K. explorer searching for Ethiopia’s first crude, fell to a four-month low in London trading after delaying the Sabisa well.
The shares slumped as much as 4.9 percent to 1,103 pence,
the lowest intraday price since Dec. 12, and traded at 1,104
pence as of 9:26 a.m. local time.
“Hole instability issues have required the drilling of a
sidetrack,” or secondary wellbore, the London-based company
said today in a statement. “The sidetrack recently commenced
and a result is now expected in late May,” rather than in March
as previously planned.
Tullow’s partner in the project, Africa Oil Corp. (AOI), fell 5
percent in Toronto on April 12 after shareholder Lukas Lundin
said drilling had been set back by technical difficulties. The
exploration group, which also includes Marathon Oil Corp. (MRO), has
drilled Sabisa in western Ethiopia to 1,810 meters (5,940 feet)
and found evidence of hydrocarbons in sands, Tullow said today.
Separately, the company said its Ngamia-1 well in Kenya
flowed 281 barrels of oil a day during tests. Tullow and Africa
Oil announced Kenya’s first oil discovery at Ngamia-1 in the
Turkana region in March last year.