Latest Gulfsands Syria drilling disappoints
London-based explorer releases poor results from Abu Ghazal-1 well
Gulfsands Petroleum, an oil and gas production, exploration and development company with activities in Syria, Iraq, Tunisia, Italy and the U.S.A, presented disappointing update to the market on Thursday in respect of its exploration projects in Syria.
The London-based independent reported that it's Abu Ghazal-1 well has been found to have "sub-commercial" levels of natural gas.
Gulfsands' prospects in Syria depend mainly on developments below-ground, though the news is discouraging to investors already rattled by continuing unrest in the country, which raises the prospect of lower investment and slower growth, reported Business Monitor International (BMI).
Gulfsands initially announced in January 2011, that the Abu Ghazal-1 well was safely estimated to yied 50 million barrels of oil equivalent.
This is not the first disappointment in Syria for Gulfsands, which abandoned its Zaman 1 exploration well after discovering only non-commercial deposits there. According to BMI, the company's Zahraa-1 exploration well, drilled in January, was suspended after locating only 'minor' oil and gas shows, while testing at the Twaiba-1 exploration well yielded only saline water.
"Potentially significant hydrocarbon columns were encountered within the Triassic aged Butmah and Kurrachine formations. However a series of drill-stem tests ("DST") undertaken on the well resulted in the recovery of sub-commercial quantities of heavy/viscous oil," Gulfsands said in a press statement.
Ric Malcolm, Gulfsands CEO, said: "Whilst we are pleased to have encountered significant oil columns within the Abu Ghazal well, the production test results have been disappointing."
Gulfsands shares listed on the Alternative Investment Market of the London Stock Exchange fell steeply on the news, from 265p to 235p, before rallying on Friday to 245p.