Premier gushes higher after striking oil at first well offshore Mexico

Premier Oil's shares gushed higher after announcing it had struck crude offshore Mexico.

Management described the discovery at its Zama-1 exploration well in Block 7 as a "world-class" discovery.

Notably, Zama-1 was the first offshore exploration to be drilled by the private sector in that North American country's history.

The London-based outfit pegged the initial gross original oil in place at in excess of 1.0bn barrels, adding that it might extend into one of the adjacent blocks.

Initial samples brought to the surface revealed light oil with API gravities of between 28 and 30 and some associated gas.

Premier and its joint-venture partners, Talos Energy and Sierra Oil&Gas encountered a contiguous gross oil bearing interval of more than 335 metres with up to 200 metres of net oil bearing in Upper Miocene sandstones with no water contact.

As of 1229 BST, shares of Premier were higher by 28.11% to 59.25p.