Cadogan reports no commercial gas reserves in its Z-11 well

Preliminary tests on Cadogan Petroleum’s (CAD LN) Z-11 well indicated no commercial natural gas reserves, the company said in its IMS today. A workover of the company’s Z-2 and Z-8 wells has also been unsuccessful due to technical problems. Currently, Cadogan is trying to reach a farm-out agreement on its non-productive Bitlyanska license in western Ukraine. The company did not disclose its current average production rate.

Roman Dmytrenko: Cadogan’s net hydrocarbon output fell 43% yoy to 214 boepd in 1H12. Considering the Zagoryanska licence area accounts for 40% of Cadogan’s net output, the failure with the Z-2, Z-8 and Z-11 wells indicates we might see an even greater drop in the company’s natural gas production for 2012.