La Tosca Disappointment for Orca

Northern Petroleum and Orca Exploration Group have been left disappointed at the Italian La Tosca field, with the pair's first exploration well plugged and abandoned despite gas shows.

In a statement today, Northern Petroleum said that the decision was made on the La Tosca-1 well, held under the Longastrino permit, following drilling to a depth of 2,335 metres last month. The company said that although wireline logging had proven the presence of gas as expected, the available reservoir sand development was more limited than had been surmised based on data from nearby wells.

In light of the disappointing result, the companies decided that it would not be economically advisable to complete the well and test further. 

Despite the setback, Northern Petroleum said today that the well would have a use in informing  the companies as to the potential of the area in the future.

"Whilst there will not be a well test, the gas shows are encouragement for further work to be undertaken to determine the future potential in the area,"  Managing Director of Northern Petroleum, Derek Musgrove said. 

He also pointed out that the cost to Northern from the well would be minimal, given that partner Orca would largely carry the cost of the exploration, as agreed under a prior farm-out agreement.

"I would also note that the company strategy for limiting the financial exposures, in this case through a farmout process, to effect a mitigation of the exploration risk, was appropriate," Mr. Musgrove said.