Shango Well Spuds in the Norwegian North Sea

Northern European junior explorer Faroe Petroleum reported Monday that drilling has begun on the Shango exploration well in the Norwegian North Sea.

The Shango prospect is located on production license 627 on the northern part of the Utsira High approximately three miles from the producing Skirne field. Shango is a structural prospect where the primary target is the Middle Jurassic Hugin formation reservoir – which Faroe said has proved to be of "excellent quality" in the neighboring Skirne field.

A fast-track subsea development to the Skirne field is planned if Shango is found to contain a similar gas and condensate hydrocarbon type. Skirne itself has been developed as a tie-back to the Statoil-operated Heimdal platform approximately 15 miles to the west.

Faroe Chief Executive Graham Stewart commented in a company statement:

"I am very pleased to announce the commencement of our 2015 exploration drilling program, with the high-impact Shango well. During the coming months we expect to start drilling the first of two follow-up wells at the significant Pil discovery... on the Blink and Boomerang prospects, and to spud the Bister prospect to follow up on our recent significant Snilehorn discovery located close to the producing Njord field infrastructure.
"Our Norwegian position is now one of the most significant of any UK independent E&P company and, despite challenging market conditions, the company is set for another year of growth in 2015, with an exciting four-well drilling program of low cost, high-impact exploration wells, fully funded from our production cash flow."

The Shango exploration well is operated by Total, which has a 40-percent stake. Faroe, Centrica Resources and Det norske oljeseskap each hold a 20 percent interest in the well.

Analysts at London-based Westhouse Securities said that they estimated that Shango is targeting between 30 and 110 million barrels of oil equivalent, and that Faroe's four-well exploration campaign for this year is targeting between 143 and 690 million boe of prospective resources in total.



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