Ophir Energy Plc, a U.K. oil and gas explorer focusing on Africa, fell the most in 11 weeks in London trading after joint-venture partner BG Group Plc decided to hand back a rig in Tanzania.
Ophir dropped 4.5 percent to close at 537 pence, the biggest one-day decline since Oct. 24, valuing the London-based company at 2.15 billion pounds ($3.5 billion).
BG said it hasn’t exercised an option to extend the Deepsea Metro I rig beyond June 8 as the venture looks for cheaper drilling in the second half of the year. The decision may slow Ophir’s hunt for oil and gas in East Africa.
“This may delay the high-impact exploration on outboard Block 1 and raise doubt in investors’ minds about BG’s enthusiasm chasing the exploration upside until a new rig is confirmed, weighing on the stock short-term,” Laura Loppacher, an analyst at Jefferies Group Inc. in London, said today.
Patrick Handley, a spokesman for Ophir, declined to comment.
Ophir said last month the rig moved to the Mzia-2 appraisal well, due for completion in late January. The drillship will then return to the Jodari asset for a drill stem test, after which the joint venture plans to resume exploration in Block 1, it said.
Ophir has an interest in Blocks 1, 3, 4, 7 and East Pande off Tanzania, according to its website. The BG venture, in which Ophir has a 40 percent share, had discovered 13.5 trillion to 21 trillion cubic feet of gas-in-place across Blocks 1, 3 and 4 as of September, it said.