Faroe Petroleum reported Friday that the 213/25c-1V exploration well, at the North Uist exploration prospect west of Shetland, has found gas condensate.
The well was targeting several reservoir objectives, the most significant of which was the North Uist prospect. It reached a total vertical depth of approximately 15,400 feet and encountered gas condensate in sandstone reservoirs in the target section.
Faroe said that an extensive data set was collected, including wireline logs, pressure data and side-wall cores. A full formation and volume evaluation is now underway.
The company added that preliminary results indicate varying reservoir quality and cautioned that the commercial potential has yet to be evaluated. Traces of hydrocarbons were also found in the shallower Cardhu prospect.
The 213/25c-1V exploration well is located near to Chevron’s Rosebank oil discovery, which is also on the Corona Ridge, west of the Shetland Islands.
The drilling operation was carried out by BP using the Stena Carron drillship. The well will now be plugged and abandoned.
Faroe Chief Executive Graham Stewart commented in a statement:
"After a long period of drilling activity on this wild-cat exploration well, we are pleased to have made a discovery in the North Uist exploration well, although we had however hoped for better quality reservoir. The result proves another working hydrocarbon system in the frontier west of Shetlands which is good news for further prospectivity in these UK waters.
"The partnership will now undertake extensive analysis of the considerable volumes of data and samples collected from the well operations before deciding on the next steps."
London-based investment bank Westhouse Securities commented: "The wording of the press release in our view suggests that the prospect does not appear to be a commercial success (at least not at present)."
Oil sector analysts had a mixed response to the news.
Analysts at FoxDavies were more upbeat. "That this wellis currently still under review is promising, and the fact that this is a frontier area must also be borne in mind as, regardless of whether North Uist is a success of not… the data will be integrated into the existing seismic and help refine the understanding of the geology."
After a disappointing drilling campaign last year, capped by the plugging and abandoning of its Rodriguez South well in the Norwegian Sea, Faroe is participating in five exploration wells that will be drilled during the remainder of 2013.
Faroe holds a 6.25-percent stake in North Uist.