Fastnet upbeat on drill costs

Fastnet Oil & Gas has said that although results were disappointing, the direct net exploration costs incurred by the company, from recent maiden drilling work at its interests offshore Morocco were less than $2.75m.

Its share price spiralled by 50% earlier this month after the first, albeit high-risk well, to be drilled in the highly-rated Foum Assaka licence was abandoned after failing to encounter commercial hydrocarbons.

However, costs incurred by Fastnet were generally low and the Irish company remains confident of finishing this year with around $40m in the bank; after it signs off as expected on its planned two-stage farm-out process with a development partner relating to its Celtic Sea assets later in the summer. The licence is being operated by US explorer Kosmos Energy.

Fastnet currently has a cash balance of $22m.

In an investor update, yesterday, the company’s management said that the recent 3D seismic survey of its offshore Ireland assets confirmed five potential reservoir targets with potential for ‘substantial’ in-place oil, at its Deep Kinsale prospect; and the potential for a new frontier exploration basin at its Mizzen prospect.

“In challenging times for the oil and gas sector, we are satisfied that Fastnet is prudently managing its cash resources, while still creating momentum in developing its portfolio of offshore and onshore assets to a stage where drilling can occur,” said managing director, Paul Griffiths.

Yesterday’s update noted that post-well analysis, at Foum Assaka, demonstrates that an important target at the prospect remains essentially untested.

Elsewhere, Irish mineral prospector Conroy Gold and Natural Resources has reported positive analysis results from its recent trenching work at Clay Lake. The company recently reported wide mineralised zones at the Co Armagh prospect.