* Owo-1 well encounters two oil bearing zones
* Well to be side-tracked to establish size of oil field
* Plans to accelerate its drilling appraisal programme
* In advanced talks with partners about procuring a new rig
* Shares rise as much as 5.9 pct
By Sarah Young
LONDON, July 26 Tullow Oil (TLW.L), Europe's
largest independent oil explorer by market value, said on Monday
it had found a major new oil field off the coast of Ghana,
raising hopes of further discoveries off West Africa.
Shares in Tullow (TLW.I) jumped as much as 5.9 percent to
1,249 pence before falling back to 1,221 at 0854 GMT, after it
announced its Owo-1 exploration well had struck oil.
London-based Tullow said the well, drilled in the deepwater
Tano licence, intersected a significant column of excellent
quality light oil. Wells in the Tano area have yielded a string
of discoveries including the Jubilee field, establishing Ghana
as a country with significant oil reserves.
"The oils and reservoir qualities here are similar to
Jubilee. We've made a substantial discovery here," Tullow's
exploration director Angus McCoss told Reuters by telephone.
"It continues the success of Tullow's equitorial exploration
campaign in West Africa... we're very well-exposed to the upside
in this play."
The well encountered 53 metres of oil pay in two zones of
high quality reservoir sandstones, with pressure data indicating
the two zones were part of the same accumulation of oil.
Tullow also has positions in the Atlantic Ocean off the
coast of Cote d'Ivoire, Liberia and Sierra Leone and is planning
to drill a number of wells on its licences in these countries in
the next twelve months.
Oriel Securities analyst Richard Rose said the Owo-1 result
was "unequivocally positive" and provided encouragement over the
potential of the neighbouring Tweneboa area.
Tullow found the Tweneboa oil field in January, building on
the 2007 find at Jubilee, which will turn Ghana into an oil
producer when it starts pumping later this year. [ID:nLDE60K08B]
Tullow said it would begin its appraisal of the Owo field
straight away by side-tracking the well to the east of the
discovery to help establish the size of the reservoir.
McCoss said Tullow planned to complete the side-track in
mid-August, at which point it would update its current reserves
"Whilst further appraisal work is required to assess the
volumetrics of Owo, confidence around achieving the P10 upside
of 1.4 billion barrels of oil equivalent has increased
significantly," analysts at Bank of America Merrill Lynch said,
referring to an industry measure of reserves which have at least
a 10 percent certainty of being produced.
Tullow, which owns a 49.95 percent stake in the Tano
licence, said the Owo find meant it was going to speed up its
appraisal plan and would drill more wells than first planned.
Discussions were at an advanced stage between Tullow and its
partners in the licence, who include privately-held U.S. firm
Kosmos Energy and U.S. oil producer Anadarko Petroleum (APC.N),
about procuring another rig, McCoss said.
"The market for the rigs is obviously better for us now than
it was several months ago," McCoss said, referring to the U.S.
deepwater oil drilling moratorium issued in the wake of BP's oil
spill in the Gulf of Mexico. [ID:nN12269656]
After completing the side-track, the rig will drill another
exploration well, Onyina-1, which sits between Jubilee and Owo.
(Editing by Lin Noueihed)