(Alliance News) - Shares in Molecular Energies PLC sank on Friday, as the company said it was considering winding down operations at a Paraguayan project.
Molecular is a North, Central and South America-focused oil and gas company. Shares in the company were down 23% at 21.20 pence each in London on Friday afternoon.
At the company's Tapir-X well in Paraguay, operations have been suspended before the company was able to reach the target zone due to "tough drilling conditions".
Molecular said that the drilling rig has been retained on site, and the participants are considering whether to continue with the project.
Separately, in Argentina, President Petroleum SA, a former subsidiary of the company, has paid down around USD1.3 million of the USD13 million in debt it owes to Molecular, and the company expects the rest to be paid down in due course.
Chair Peter Levine said: "The result of the Tapir x-1 well, whilst disappointing, is not surprising given it is the frontier exploration. Sometimes it is the better decision in tough drilling conditions to make a bold resolution to suspend rather than continuing in escalating cumulative down hole issues, especially taking into account the risk-reward ratio."
By Hugh Cameron, Alliance News reporter
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