Genel may succeed with oil find in Morocco where others failed

Genel may succeed with oil find in Morocco where others failed

FIRAT KAYAKIRAN

LONDON (Bloomberg) -- Genel Energy Plc, the oil explorer headed by former BP CEO Tony Hayward, discovered oil at its Moroccan project while it continues testing for definitive results.

The company has “encountered oil during drilling operations” in a well in the Sidi Moussa block offshore Morocco, Serica Energy Plc, Genel’s partner in the project, said in a statement Oct. 20. “Preparations are under way to perform cased hole testing.”

Some of the world’s biggest oil companies, including BP and Chevron Corp., plan to expand operations off Morocco this decade, while oil explorers including the UK’s Cairn Energy Plc and Gulfsands Petroleum Plc have abandoned drilling in some blocks after failing to find commercial reserves.

“Genel confirms the information contained in the operational updates issued by its partners,” the London-based company said in a separate statement. “It is premature at this stage of operations and ahead of the forthcoming testing of the well to make any definitive technical interpretation.”

Shares in Genel, which holds a 60% working interest in the project, rose as much as 2.9% to 735 pence before retreating 0.6% to 710 pence at 9:31 a.m. in London. Serica, which owns a 5% stake in the project, rose 11%.

San Leon Energy Plc, a third partner in the Moroccan project with a 10% working interest, gained 2.2% to 2.3 pence. Total well-testing costs at the project are expected to be about $22 million, San Leon said in a statement Oct. 20.

Genel also operates in Iraq’s Kurdistan region.