- Shares of explorer rise as much as 11%, most since Nov. 2014
- Company is `delighted' with flow rate from West African field
Cairn Energy Plc gained the most in 16 months after the explorer reported positive results from an oil well off Senegal, potentially opening up commercial development for the area.
Two separate tests on the SNE-3 offshore appraisal well in West Africa flowed at a rate of about 4,000 barrels a day, Cairn said in a statement Wednesday. That follows a successful test of the SNE-2 in January.
Shares of the company rose as much as 11 percent to 188.50 pence in London, the biggest jump since November 2014, outperforming its peers on the FTSE 350 Oil and Gas Producers Index.
“Cairn is delighted with the flow rates from the latest well in the Senegal appraisal program,” Cairn’s Chief Executive Officer Simon Thomson said in the statement. The results “validate the scale and growth potential of the SNE field.”
The test result is well ahead of expectations and “strongly supports a commercial development offshore Senegal,” Exane BNP Paribas said in a note to clients. The bank expects a “strong increase” in the best estimate of contingent resources at the prospect, which currently stand at 330 million barrels.