SDX Energy abandons latest well after non-commercial find

The well at South Disouq in Egypt, which SDX operates and owns a 55% working interest in, was drilled to a total depth of 8,075 feet and encountered a high quality reservoir interval but will now be plugged and abandoned.

Paul Welch, president and chief executive of SDX, said: "The results of the Kelvin-1X well are not commercial and will not contribute to the initial production in this first phase of the development at South Disouq. However, today's news follows the positive results from previous drilling activity in the concession where our first two wells were commercial discoveries."

The company said it had been hoped that the Kelvin-1X well, located updip of the SD-1X discovery, could potentially be connected to the SD-1X structure by a continuous gas bearing section but it is instead separate and contains non-commercial saturations.

The rig will move on to drill the SD-4X appraisal well, the next scheduled well on the South Disouq licence, which is also targeting the SD-1X structure.

"We have had a very good run of drilling success lately and it is unfortunate that Kelvin-1X hasn't worked out. However, we are looking forward to drilling two appraisal wells on the SD-1X structure and reporting on these in due course," said Welch.

The SD-1X discovery well was drilled in the second quarter of 2017 and the company successfully flowed natural gas at a stabilised rate of 25.8 Mmcf/d on a 48/64" choke at the site.

As of 1259 BST, SDX Energy’s shares were down 6.69% at 66.25p.