Sterling Energy drops after well failure on Ntem concession

8th Apr 2014 08:26

Sterling Energy, an AIM-listed exploration company, sparked a swift decline in its share price on Tuesday after announcing the Ntem concession, offshore Cameroon would be plugged and abandoned after it failed to find commercial hydrocarbons. Data from Bamboo-1, which was the first exploration well to be drilled on the Ntem Concession, will be analysed in detail and the results used to update the assessment of the remaining prospectivity of the block, which covers 2,319km squared. The current phase of the Ntem concession runs to April 2015, with the option to extend the exploration term by a further two years. Sterling Cameroon has a 50% non-operated working interest in the Ntem concession. Murphy, which holds the 50% operated interest under the terms of the farm-in agreement signed in 2011, will pay Sterling's share of the costs for the drilling of the Bamboo-1 well. Alastair Beardsall, Chairman and acting Chief Executive Officer of Sterling Energy, said: "Bamboo-1 was the first well in a large unexplored area. "We have identified further Cretaceous and Tertiary prospects in the Ntem block and these will be re-evaluated with the significant new data from Bamboo-1 before determining our future plan for the Ntem block."The share price plunged 22.01% to 35p by 08:36 on Tuesday.NR