April 19 (Bloomberg) -- Tullow Oil Plc, a U.K.-based oil and gas explorer, said two wells in Sierra Leone and Ivory Coast encountered water-bearing reservoirs.
The Mercury-2 well in Sierra Leone intersected more than 270 meters of reservoir quality sandstones which were water bearing with oil shows, the company said in a statement today. The Kosrou-1 well in Ivory Coast encountered 90 meters of reservoir quality sandstones.
“The existence of thick sandstone fairways and a working hydrocarbon system, proven by every well in our exploration campaign, mean that our West African Transform Margin acreage remains highly prospective,” Tullow Exploration Director Angus McCoss said in the statement.
Tullow is trying to add reserves after unlocking new oil provinces in Uganda, Ghana and French Guiana, where it has found about 4 billion barrels since 2007. The explorer’s shares fell in February when it announced that its Jupiter-1 well in Sierra Leone might not be commercial.
“While today’s results at Kosrou and Mercury-2 have not yielded commercial discoveries, these further indications of a working hydrocarbon system help us see upside in nearby exploration targets,” Sanford C. Bernstein & Co. analyst Oswald Clint said in a note to investors. “Momentum is clearly building for Tullow in its East African exploration campaign.”
The stock retreated 1.1 percent, or 16 pence, to close at 1,502 pence in London.
Anadarko Petroleum Corp operates and controls 55 percent of the Mercury offshore block and 50 percent of the Kosrou acreage, according to the statement. Other owners include Repsol YPF SA.
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