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Leyshon Resources share plunge – what does that say about drilling risk?

By Tom Winnifrith | Monday 17 June 2013


Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from ShareProphets). I have no business relationship with any company whose stock is mentioned in this article.


Leyshon Resources (LRL) has announced that it has abandoned ZJS6, its second well drilled in the Ordos Gas basin. It states that it has encountered water in several zones and thus cites “technical problems” as its reason for pulling away. The well did discover gas so is not a total wipe out but technically this will be very hard work and so quite rightly Leyshon has cracked on with the third of its planned eight wells in Ordos.


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