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Egdon Resources

  • BY: Andrew Hore |
  • POSTED: 13/02/2008 |

Onshore oil and gas explorer Egdon Resources reported disappointing news from its Grenade prospect in south west France.

It says that the well it drilled was not “hydrocarbon bearing”. In other words there was no oil.

Egdon believes that this indicates the eastern limit of the oil but thinks that there is still potential to the south and west of the original well which led to the discovery of heavy oil in Grenade in south west France by Elf in 1975.

That well even produced 8,000 barrels of oil up until 1985. The oil in place estimate is 300m barrels. Heavy oil can sell for around three-fifths of the price of Brent crude and the recovery levels may be around 5% but this could still be a highly lucrative field. Egdon has a 33.42% operated interest in the prospect.

Egdon retained cash of £4m when it split from Portland. That is more than enough to finance its current plans.

There had been high hopes for the Grenade well so it is no surprise that Egdon shares dipped 2.75p to 24p.

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