Equinor’s Verbier appraisal well disappoints

Equinor has hit a duster a UK North Sea well aimed at appraising the Verbier discovery, leading to a downgrade of resource estimate.

This was shared by Equinor’s partner in the project Jersey Oil & Gas on Wednesday. The company said that the appraisal well 20/05b-14 did not encounter Upper Jurassic sands as anticipated.

“As a result, our contingent resource volumetric estimations for the Verbier discovery are likely to be revised towards the lower end of the initial resource estimate of 25 million barrels of oil equivalent (“mmboe”) announced following the discovery in October 2017,” Jersey Oil & Gas said.

Jersey Oil and Gas shares dropped from 128 pence to 85 pence immediately following the announcement, rising to 101 pence on Wednesday afternoon.

JOG last month said initial operator estimates of gross recoverable resources associated with the Verbier discovery had been between 25 and 130 million barrels of oil equivalent (mmboe) with an estimated mean of 69mmboe. The appraisal well, spudded last month, was drilled with the West Phoenix semi-submersible drilling rig.

JOG: Verbier still viable for development

The appraisal well results will be fully integrated with the final processed data from the 3D seismic survey acquired in 2018 in order to evaluate the upside potential for further Verbier appraisal activity, JOG said.

A large part of the mapped area of the Verbier discovery, located to the north-west of the 20/05b-14 well location remains untested. Additional resource potential, which was not tested with this well or the discovery well, has also been identified in a deeper horizon beneath the Verbier discovery. This, along with the Cortina prospect, will be matured with the new seismic data and be considered for future drilling, JOG said.

“It is JOG’s view that the Verbier oil discovery remains commercially viable at 25 mmboe and we look forward to evaluating potential future development options, including the potential to develop the Verbier discovery as part of a wider area development plan,” the company said.

Andrew Benitz, CEO of Jersey Oil & Gas, commented: “We are both surprised and disappointed by the results of our appraisal well. JOG remains confident that Verbier is a commercially viable development project that could be further enhanced by the potential for a new area hub development, together with undeveloped discoveries that sit in close proximity to Verbier.

Verbier has been a play-opener for JOG and we remain excited about the growth potential surrounding this valuable asset. JOG remains well-funded to pursue our growth plans and will continue to assess various acquisition opportunities as we move forward.”

Equinor is the operator of the block containing the Verbier discover with a 70 percent share, with JOG holding 18 percent and CIECO V&C (UK) Limited 12 percent.

Worth noting this is the second duster for Equinor announced on Wednesday. In the Norwegian section of the North Sea Equinor has concluded the drilling of wildcat well 36/1-3. The well was dry. The well was drilled in production license 885, about 15 kilometers east of the 35/3-2 (Agat) gas discovery and 55 kilometers northwest of Florø.