LONDON (ShareCast) - Shares in oil and gas explorer Sterling Energy slipped back on news that it has plugged and abandoned the THAM-1 well in the Themis Marin permit in Gabon.

The company said the well was drilled to its target depth of 1,330 metres in 11 days, on budget, but the results were disappointed.

Sterling noted it has only a 28.5% interest in the well, some of which had been farmed out, and thus it paid only 10.5% of the well costs, which came to around $13.5m in total.

Afren, the oil and gas exploration and production company, has a 12.86% stake in the Themis Marin permit.

Work on the second well in the Gabon drilling programme, ICM-1, is scheduled to start in April of this year. This well is in the Iris Marin licence, in which Sterling has a 50% interest while Afren has a 12.86% stake.

Sterling said the ICM-1 well has a much higher potential payload than the THAM-1 well, and that gross reserves of 11m to 40m barrels are expected.

• News Channel