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Faroe Petroleum makes second oil and gas discovery in Norwegian Sea, shares jump

Faroe Petroleum (LON:FPM)  has intersected a 64 metre gross oil column in a better-than-expected reservoir at its 30% owned Maria prospect in the Faroe islands, proving oil in the main target Garn formation in Jurassic sandstones and causing its shares to soar 26% by early afternoon trade.

Preliminary analysis has indicated that gross volumes in place (STOIIP) ranged between 250 and 520 mmboe (million barrels of oil equivalent) and gross recoverable volumes are estimated at between 75 and 155 mmboe of oil and associated gas.

The column is situated on the Halten Terrace, which is close to the existing development infrastructure.
The Maria prospect (Blocks 6407/1 & 6406/3) is situated on the Halten Terrace, between Smørbukk Sør and the Trestakk oil discovery and the Tyrihans gas field.

Maria consists of two segments, Maria South and Maria North, located respectively up dip to the south west and north east of the 6406/3-5 well. The Maria well 6406/3-8 T2 has been drilled on the Maria South segment and is the first exploration well to be drilled on licence 475BS, which was awarded in the APA 2008 licensing round.
According to the company, initial analysis has shown that the Maria oil had properties
similar to the oil in the nearby Trestakk discovery, at around 40 degrees API.

Faroe Petroleum made another discovery, Fogelberg, in April this year.

“We are very pleased to announce a discovery on the Maria Prospect, which is our second successful well on the Halten Terrace in the Norwegian Sea this year...Maria is clearly material to Faroe... we look forward to the further evaluation of this discovery,” said chief executive Graham Stewart.

The current equity holders in the licence are operator Wintershall Norge ASA, which holds 25%, Concedo ASA with a 10% interest, Spring Energy Norway AS 15%, Centrica Resources with a 20% stake, and Faroe Petroleum Norge AS with the largest equity stake at 30%. The net recoverable volumes to Faroe Petroleum estimated at between 22 and 46 mmboe.

Faroe is now gearing up to spud the Anne Marie well in the Faroe Islands and later drill North Uist/Cardhu and Lagavulin in the UK operated by Eni (NYSE:E), BP (LON:BP) and Chevron (NYSE:CVX) respectively.