Bowleven gets exploration extension in Cameroon

July 08, 2011 | Africa, Government & Regulations

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Oil and gas explorer Bowleven said on Friday it had managed to get a one-year extension to the exploration phase of the Etinde PSC, offshoreCameroon.

The AIM-listed explorer announced approval had been granted by the government ofCameroon and planning for continued exploration and appraisal activities through 2012 was already underway.

Investors were slightly disappointed there was not more positive news, as they have been waiting for updates on the Sapele-2 well, and the shares fell by 3%.

The firm, which focuses onWest Africa, said only that the Sapele-2 well had been drilled to appraise both the Lower and Deep Omicron discoveries and a testing programme was now ongoing.

Mechanical difficulties were encountered during testing activity, but have now been resolved and Bowleven said results from testing are now expected in approximately two weeks.

In a further update, Bowleven said the Cameroon LNG project to advance the monetisation of the gas resource within the country via an aggregation scheme was progressing

A gas sales term sheet had been signed by Etinde joint venture and SNH/GDF Suez, the party behind the initiative.

Kevin Hart, chief executive of Bowleven, said: “The Etinde PSC extension allows us to maintain momentum in pursuing our dual strategy of targeting high impact exploration inCameroonwhile also focusing on converting resources to reserves. We eagerly await the test results from Deep and Lower Omicron at Sapele-2.”

Back in May, shares in the firm surged after it struck black gold at the Sapele-2 well.

This followed earlier disappointment in the market due to poor results from the Sapele-1 side track and a fear from investors that the Sapele discovery would merely “whimper away”, according to David Farrell, analyst at Evolution Securities.

Then in June the company announced it believed flow rates from the Sapele-1 side track well to be commercial. Shares in the firm have shot up almost 140% in the last year to sit at 333p.