Ophir Energy confirms success of Mzia appraisal well

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LONDON (ShareCast) - Ophir Energy (Other OTC: OPGYF - news) , the FTSE 250 (FTSE: ^FTMC - news) oil and gas group, said Thursday that the Mzia-2 appraisal well in Tanzania had been a success, with the Mzia-1 and Mzia-2 columns confirmed to be in direct pressure communication.

The results confirmed a vertical gas column of at least 200m for the Mzia field, in which it holds 40%, with the remainder held by BG Group (LSE: BG.L - news) .

Mzia-2 has now been suspended for potential testing.

The company also announced that its block 1 flow testing programme is due to begin "imminently" on the Jodari field, with a subsequent drill stem testing of Mzia being planned.

However, the firm warned that due to the high-quality reservoir properties verified in the Jodari field, the joint venture anticipates that the observed flow rate may be constrained by the limits of testing equipment.

The company also said that test rates from the Cretaceous-aged Mzia reservoir are forecast to be lower than from the Tertiary due to differences in burial depth and the relative parameters of the two reservoir types.

Following completion of testing the joint venture will re-commence exploration drilling with an anticipated two well programme starting in early April," Ophir said.

"The joint venture is actively interpreting and mapping an inventory of prospects following which Ophir will update the market with both target sizes and proposed well locations."

The company added that the JV is undertaking a 2,500 sq km 3D seismic survey in the inboard area of Block 1 to investigate additional resource potential and mature further drilling targets and said the acquisition of the inboard 3D survey is expected to be completed in late March.

Despite the generally positive update, the stock continued to suffer a decline in its share price as the stock rebalanced after two stakeholders - Och-Ziff and Mittal Investments - on Tuesday evening announced that they planned to trade in half their holdings through Credit Suisse (NYSE: CRP - news) .

The share price had fallen 8.95%, equal to 46.50p, to 473p by 08:50.

NR