Energy: Byron’s newest well is paying off only 3 weeks after drilling started; shares up 28pc
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Since early July, Byron Energy (ASX:BYE) shareholders have seen tough times with shares falling after one well in Louisana was a write-off. But this morning shares climbed over 35 per cent after another well was more successful.
The company started drilling the SM58 011 well three weeks ago and it has been drilled down to 10,875 feet. Byron announced today it had “encountered hydrocarbons in the target O Sand section”.
And this could be just the start. Gamma Ray and resistivity tools showed hydrocarbons were only beginning at this depth. The company reckons its drilling opportunities lie at lower depths.
This well will be drilled to 11,466 feet and at this point Byron will survey the exact hydrocarbon types and liquid content.
While Byron’s less successful well was co-owned with Metgasco (ASX:MEL), but 100 per cent operated, this one is 100 per cent owned (down to a depth of 13,639 feet) and operated by Byron.
It is located in an oil-prospective area, known as the O Sands, which has produced 16.5 million barrels of oil and 85 billion cubic feet of gas since 1964.
Byron CEO Manyard Smith believes the successful results will lead to commercial development.
“This result vindicates the high effort that was put into the seismic processing which was used to define and drill the Cutthroat Prospect,” he said.
Byron shares went as high as 40 per cent at market open but edged back to 29.5c — a 28 per cent gain at 10.40am.
Another American-focused oil explorer, Helios Energy (ASX: HE8), also announced oil flow this morning. Its Presidio 141#2 well has been flowing 1,295 barrels of fluid per day for the last three days. This has translated to 146 barrels of oil per day as well as 566 million cubic feet of gas. Helios shares jumped 9 per cent this morning.