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LONDON - Mosman Oil and Gas Limited (AIM:MSMN) announced Thursday the completion of drilling at the Garcia prospect, where the company holds a 20% working interest, with disappointing results.
The well, spudded on June 24, reached a total depth of 1,288 feet where it encountered water in the primary Lyons formation target. According to the company, flow testing at the top of the formation showed a small percentage of helium, but with a weak flow rate that was attributed to tight rock with low porosity.
After drilling an additional three feet and encountering more water, the decision was made to halt further operations. The well will now be converted into a water well at an expected cost of up to $30,000.
Howard Mclaughlin, Interim Chief Executive Officer of Mosman, indicated that following these disappointing results, the company has entered into discussions about potentially concluding the drilling program early.
"We have entered into discussions about potentially concluding the drilling programme early, reflecting our commitment to preserving cash resources and with the intention of allowing us to focus our full attention and financial resources on the Sagebrush and Coyote Wash helium projects," Mclaughlin stated.
The company expects the final well cost to align with pre-drill expectations, though exact figures have not yet been received. Mosman plans to provide shareholders with a further update next week regarding discussions with partners about the continuation of the current Vecta campaign.
The information was disclosed in a company press release statement.
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