3rd Sep 2013 07:25
LONDON (Alliance News) - Kea Petroleum Tuesday saw its shares plunge after it said it wouldn't be drilling the Angus field and was considering its options regarding its Puka discovery because of the challenges that small oil explorers are facing accessing capital markets.
The company which explores for oil and gas in New Zealand said it had decided not to renew the PEP51155 permit to develop the Angus prospect for a further five years and would not be drilling.
It said that a considerable number of issues had dogged anticipated flow rates at its Puka discovery, but combined total flow rates at the Puka 1 and Puka 2 wells had now stabilised at about 200 barrels of oil a day.
It said it anticipates drilling a third appraisal well, Puka 3, in the first quarter of 2014.
"The Directors believe that the scale of the Puka discovery, and the current challenges for small sized oil explorers in accessing capital markets, merit a review to assess strategic alternatives that will enable shareholders to maximise full value from the Puka fields," the company said in a statement.
It said that it had also received interest from a large number of parties in potentially participating in the development of Puka and some of Kea's other exploration prospects. It has appointed Gresham Advisory Partners Ltd in Sydney to conduct a review.
"This review is in its early stages and further announcements will be made as and when appropriate," it said.
The stock was down 21% at 3.25 pence early Tuesday, one of the biggest declines on the London market.
By Steve McGrath; [email protected]; @SteveMcGrath1
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