FAR Limited (ASX:FAR) - Managing Director, Catherine Norman
Managing Director, Catherine Norman
Source: Far Limited
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  • FAR (FAR) expects the final cost of drilling the Bambo-1 well will increase by $9.87 million (A$14.07 million) amid a series of delays
  • The energy stock had to temporarily halt drilling at 3216 metres after significant fluid losses were experienced at the asset offshore of Gambia
  • As a result of the fluid, FAR will plug and side-track the well to continue drilling to the planned total depth of 3450 metres
  • The additional work means Bambo-1 is unlikely to hit total depth until the end of the month, with no information on depth or formation available just yet
  • Shares in FAR are trading up 2.07 per cent at 74 cents each

FAR (FAR) expects the final cost of drilling the Bambo-1 well will increase by $9.87 million (A$14.07 million) amid a series of delays.

Bambo-1 is being drilled as part of a joint venture project and is located roughly 85 kilometres offshore of Gambia.

The energy stock released a wide-ranging update on Monday, noting it was likely to net US$4.935 million (A$7.03 million) of the increased costs.

The blowout in expenses comes after drilling temporarily halted when significant fluid losses were experienced at the asset offshore of Gambia.

The fluid losses occurred when drilling hit its current depth of 3216 metres, with FAR now planning to plug and side track the well.

Bambo-1 will be drilled to a final depth of 3450 metres, with work likely to be extended by an additional few weeks.

The ASX lister said it would also undertake a wireline logging program in the current wellbore, prior to side-tracking.

No information about the depth or formation of Bambo-1 is likely to be provided, as FAR has designated the well a “tight hole”.

Commenting on the drilling delays, FAR Managing Director Cath Norman said the company still had cash reserves of around US$37 million (A$52.74 million).

“FAR is pleased with the experienced drilling team and contractors who have acted to quickly manage and adjust the Bambo-1 drilling program to suit the geological setting and best meet the objectives of the drilling program,” Ms Norman said.

“FAR is well placed to achieve these objectives through the side-tracked well and in particular drilling through the as yet undrilled Soloo Deep prospect.

“We are encouraged by the presence of oil in potential reservoirs and look forward to completing the well in the coming weeks.”

Shares in FAR were trading up 2.07 per cent at 74 cents each at 11:37 am AEDT.

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