16th May 2014 10:18
LONDON (Alliance News) - Falcon Oil & Gas Ltd Friday said its second exploration well at the Mako Trough in Hungary has gone into test drilling, but results from its first well at the site have failed to show commercial levels of hydrocarbons.
The oil and gas exploration and development company said Besa D-1, its second of three exploration wells to evaluate the gas potential of the Algyo Formation in the Mako Trough, has started test drilling.
The company said results from Kutvolgy-1, the first well on the site, showed improved recovery rates from certain intervals during drilling, but well production did not meet commercial rates and it has discontinued testing the well.
Falcon Oil & Gas said it is now focused on Besa D-1 and its partner on the site, Naftna Industrija Srbije JSC, continues to study the hydrocarbon potential of the entire region including the Deep Mako play.
According to a deal between the two parties in January 2013, NIS will cover the costs of drilling the three wells, but any hydrocarbon sales revenues resulting from the programme will be shared between the two companies.
Falcon Oil & Gas shares were down 11% to 7.70 pence, putting it among the top-ten AIM ALL-Share fallers on Friday.
By Tom McIvor; [email protected]; @TomMcIvor1
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