Cairn Energy Announces Oil Discovery Offshore Senegal; Stock Surges

(RTTNews) - Cairn Energy Plc. (CNE.L) Tuesday said the FAN-1 exploration well, offshore Senegal, has discovered oil. The stock climbed over 10 percent.

The well, located in 1,427 meter water depth and approximately 100 kilometres offshore in the Sangomar Deep block, has reached a Target Depth of 4,927 meters and was targeting multiple stacked deepwater fans.

Preliminary analysis indicates 29 meters of net oil bearing reservoir in Cretaceous sandstones.

No water contact was encountered in a gross oil bearing interval of more than 500 meters.

The FAN-1 well is the third well in Cairn's North West Africa program and first in Senegal.

Cairn said further evaluation is required to calibrate the well with the existing 3D seismic to determine future plans.

Cairn has a 40 percent working interest in three blocks offshore Senegal, ConocoPhillips (COP) has 35 percent working interest, FAR Ltd 15 percent working interest and Petrosen, the national oil company of Senegal has 10 percent working interest. The three blocks cover 7,490 square kilometers.

CNE.L gained 9.9 percent in early morning trade to 197.72 pence.