Africa-focused Tullow Oil said today it would abandon its drilling operations at an exploration well offshore Guyana after results showed the well bore water, sending its shares 6% lower.
The group, which holds 37.5% of the Kanuku block where the Beebei-Potaro exploration well lies, said it would work with its joint venture partners before deciding on its next steps.
Spain's Repsol, which operates the Kanuku licence, and TOQAP, a joint venture between Total and Qatar Petroleum, hold the remaining interests in the block.
The results mark another disappointment for companies drilling offshore Guyana, Panmure Gordon analysts said, adding that the only block that has shown and delivered anything in the area was the Exxon-operated Stabroek.
Tullow said the well that had been plugged had been drilled to a depth of 4,325 metres and had displayed a "good quality reservoir" in its primary and secondary targets, but was water-bearing.
Tullow had previously said it would limit capital exposure in Guyana, which is in the north of South America, possibly selling a portion of its stake to another company.
It has so far not announced any plans to do so.
Tullow holds a 60% interest in the Orinduik block, its other licensed area in Guyana, with partners including Total and Eco Atlantic Oil & Gas.