SHETLAND-focused Hurricane Energy has provided another boost to hopes there could be an oil boom in the area after enjoying a fresh drilling success.
Hurricane said a well to appraise the Lincoln find had produced oil at the weekend.
Noting speculation about a flare on the rig concerned it said: “A drill stem test on the Lincoln Crestal well has produced oil to surface.”
Read more: Shetland oil pioneer shrugs off 'Monty Python slap in face with a wet fish'
The Surrey-based firm said it would not provide further details until completing testing work.
However, with shares in the company rising around four per cent yesterday it looks like some investors reckon good news is in prospect.
The well forms part of one of the most eagerly anticipated drilling campaigns completed in the wider North Sea area in recent years.
It is being drilled to appraise a find that Hurricane made in 2006 that experts reckon could contain 1.4 billion barrels recoverable oil.
The find is one of a number made by Hurricane after it launched a pioneering exploration drive in what is an under-explored area compared with areas of the North Sea closer to the Scottish mainland.
Led by Robert Trice, Hurricane started production from the 500 million barrel Lancaster find in June.
Read more: Big Shetland oil bet pays off for investors
The company’s success has helped to generate huge excitement about the West of Shetland area, which is now firmly on the agenda for a range of firms.
Hurricane is drilling the Lincoln well with oil and gas heavyweight Spirit, which is part-owned by Centrica.
Spirit bought a 50 per cent interest in the acreage containing Lincoln in September last year. The company said then the deal allowed it to participate in the early stages of one of the last known world-class oil development opportunities in the UK.
Spirit agreed to fund an $180m drilling campaign covering appraisal work on Lincoln find and exploration drilling on the Warwick prospect.
The partners suffered a reverse in July when a well drilled on Warwick failed to produce oil or gas at commercial rates.
Mr Trice said then that Lincoln was the preferred candidate for a development. He noted the potential to connect Lincoln to the huge floating production facility developed for Lancaster. This could allow the field to be developed relatively quickly and cheaply.
Read more: West of Shetland fields could be 'game changing' for oil and gas industry
Earlier this month Hurricane noted that the production system on Lancaster had been performing well.
The company sold 1.2 million barrels of oil from the giant Lancaster field West of Shetland within three months of starting production.
Average daily production has been running around 40 per cent above initial expectations, at 14,400 barrels of oil per day.
Shares in Hurricane Energy closed up 1.5p at 33.5p.That left the firm with a market capitalisation of around £880 million.
Mr Trice founded Hurricane in his garden shed in 2005 after working for Shell and Enterprise Oil.He wanted to focus on an area of granite called the fractured basement. This lies beneath the sandstone on which most North Sea drilling has focused.
Hurricane won backing from private equity investors amid the deep downturn in the North Sea triggered by the crude price plunge from 2014.
Read more: North Sea oil and gas industry in best shape for years finds key report
The rise in the crude price since late 2016 has helped fuel a recovery in the area.
Last week Oil & Gas UK said the North Sea industry was in the best shape for years but sections of the supply chain remained under pressure. Exploration activity fell to a record low in the UK North Sea last year.
Why are you making commenting on The Herald only available to subscribers?
It should have been a safe space for informed debate, somewhere for readers to discuss issues around the biggest stories of the day, but all too often the below the line comments on most websites have become bogged down by off-topic discussions and abuse.
heraldscotland.com is tackling this problem by allowing only subscribers to comment.
We are doing this to improve the experience for our loyal readers and we believe it will reduce the ability of trolls and troublemakers, who occasionally find their way onto our site, to abuse our journalists and readers. We also hope it will help the comments section fulfil its promise as a part of Scotland's conversation with itself.
We are lucky at The Herald. We are read by an informed, educated readership who can add their knowledge and insights to our stories.
That is invaluable.
We are making the subscriber-only change to support our valued readers, who tell us they don't want the site cluttered up with irrelevant comments, untruths and abuse.
In the past, the journalist’s job was to collect and distribute information to the audience. Technology means that readers can shape a discussion. We look forward to hearing from you on heraldscotland.com
Comments & Moderation
Readers’ comments: You are personally liable for the content of any comments you upload to this website, so please act responsibly. We do not pre-moderate or monitor readers’ comments appearing on our websites, but we do post-moderate in response to complaints we receive or otherwise when a potential problem comes to our attention. You can make a complaint by using the ‘report this post’ link . We may then apply our discretion under the user terms to amend or delete comments.
Post moderation is undertaken full-time 9am-6pm on weekdays, and on a part-time basis outwith those hours.
Read the rules hereLast Updated:
Report this comment Cancel