Globe Exploration LP (TASE: GLEX.L) today announced that it was abandoning the Ofek 1 well, in the Ofek license near Lod, after earlier reporting no results from the Ofek 1 and Ofek 2 wells. The company said that no producible quantities of hydrocarbons were found in the well.
Globe Exploration said that the Ofek 1 well reached a depth of 2,529 meters, before drilling was halted. The well cost $7.8 million, not including the operator's fees, and $165,000 in future payments to rehabilitate the drill site. Part of the costs were due to the continuation of the drilling after a technical fault.
Globe Exploration added that Azrieli Zolti was no longer a party at interest in the company, after selling more participation units. He owned 6.45% of the company in December, making him the third largest shareholder, but subsequently sold units, reducing his stake to 4.3%.
Following the sale of 56.7 million participation units at NIS 0.01 per unit on May 23, Zolti further reduced his stake to 3.17%. He is considered a veteran player in Israel's oil exploration industry. He also owns a stake in Modiin Energy LP (TASE:MDIN.L), and previously owned stakes in Avner Oil and Gas LP (TASE: AVNR.L), Delek Drilling LP (TASE: DEDR.L), and other gas exploration companies.
In February, Globe Exploration announced that the Ofek 1 well was a dry hole, and in December 2011, it announced a mechanical problem in the upper part of the borehole, which blocked the lower sections of the borehole, including the target strata. The incident cost the company an additional $2.4 million, on top of the drilling costs previously reported.
Earlier this month, Globe Exploration announced that the drilling of the Ofek 2 well was halted before reaching the target strata at a depth of 5,950 meters, due to mechanical and technical limitations at 5,400 meters, following changes in the borehole's pipes and drill head.
Globe Exploration's share price was unchanged at NIS 0.01 in morning trading, giving a market cap of NIS 27 million.
Published by Globes [online], Israel business news - www.globes-online.com - on May 28, 2012
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