The announcement basically says that they have just spent all...

The announcement basically says that they have just spent all this time and came up dry... That whole area in grey in the diagram is where the east malisu well is and has no commercial reserves.

The new well they are moving to, is an infill well... The well 400m away has produced 300,000bbls.... this means at 400meters away they are targetting the same sands..... these sands will more than likely be depleted I don't expect miracoulous results. The well is likely to be succesfully drilled (i.e. produce oil initially) if there is no mechanical failures but the rate at which oil prodution drops will be pretty quick... the field is drained.... think about the reservoir as a long thin sponge at the bottom of a baking dish...there has been a well draining the fluid from the left and the new well is being drilled on the right.... depending on how much oil is left in that sponge will determine productivity.... It seems like it is a save face excercise.... they will demonstrate an increase in production which will look good to shareholders but they havent actually added reserves.

The share prices should still go up but they are not proving any more reserves so they are not really growing the company