NZAX-listed oil and gas exploration company Widespread Energy has announced it will plug and abandon its Kotuku exploration bore before it got to its target depth due to engineering problems.Widespread recommenced drilling on the stratigraphic bore near t
NZAX-listed oil and gas exploration company Widespread Energy has announced it will plug and abandon its Kotuku exploration bore before it got to its target depth due to engineering problems.
Widespread recommenced drilling on the stratigraphic bore near the Kotuku oil seeps on the West Coast of the South Island last week.
The company was aiming to drill a 250m deep bore which would allow it to confirm the shape of the Kotuku anticline, recover samples of the rock strata and determine the nature of any fluids contained within it.
But in a statement released today, the company said “engineering difficulties” with the six-inch casing saw the failure of several attempts to re-enter Widespread 1A, leading to the decision was made to plug and abandon the bore.
Managing director Chris Castle said that while the 250m target was not reached, there were “persistent oil shows” in a 69 metre interval from 21 metres to 90 metres.
“Our immediate focus now is to undertake a detailed analysis of the data gathered to date before planning the next stages of the exploration programme.”
Widespread raised almost $200,000 through a private placement in January to cover the costs of the drilling, with investors in the placement agreeing to subscribe for another 1.65 million shares if Crown Minerals granted Widespread a prospecting licence over the Chatham Rise in the next 12 months.
That license was granted in February and a share purchase plan was launched in May, with shares offered at 11c, 4c below the company’s current price on the alternative board (NZAX: WEN).
The offer closed on Friday, after Widespread had confirmed that it had received expressions of interest from significant investors to subscribe for any shortfall from the offer, making it likely that the full amount of 3.6 million shares offered will be allotted.
