ECONOMY

Oil field ‘exceeds expectations’

UK-based Regal Petroleum PLC announced yesterday that the oil that flowed out of the Kallirachi exploration well in the northern Aegean Sea, off the coast of Greece, has exceeded expectations by a «considerable margin.» Initial data analysis showed that Kallirachi 1, which was drilled in 49 days to a total depth of 2,555 meters, could «conservatively» produce up to 2,000 barrels of oil equivalent per day. The probable and possible oil-in-place volume is expected to be up to 650 million barrels, of which 240 million are recoverable. «The Kallirachi find has exceeded our expectations by a considerable margin. The discovery of a sweet oil reservoir of such proportions, with Regal’s significant infrastructure already in place in an important European Union country, underpins the considerable potential of Regal,» said Executive Chairman Frank Timis. The group, along with its Greek unit Kavala Oil SA, is preparing a six-month program of further appraisal of the field. Two development and production wells are planned for the third quarter, it added. The news has sent Regal’s share price soaring 45.5 pence or 17.3 percent to 306 pence. The stock has risen from 116 pence since the start of the year. Investors have also been cheered by news that Regal intends to accelerate production from the nearby but mature Prinos and Epsilon fields. These are now shown to have recoverable reserves of 80 million barrels, equivalent to around eight years’ supply. In all, Regal plans to increase daily production from the Aegean from its current 4,000 barrels a day to 25,000 by July 2005. This is well within the capacity of its local processing plant. «The operations break-even level of production from Prinos, Prinos North and Epsilon is estimated at 4,200 barrels per day assuming an oil price of $20 per barrel,» it said. (Combined reports)