Premier Oil said yesterday it planned to drill 14 exploration wells this year with earliest results due next month from its Indonesian Matang-1 well.
The announcement comes after delays and dry wells gave mixed exploration results for 2012, including a £100million write-off of costs.
The UK-listed firm plans to increase capital expenditure in exploration this year to about £125million from £113million previously, together with a substantial increase in development spending to about £563million from £344million.
The company, which grew turnover last year by over two-thirds to around £877million, projected continued growth in its production to 65,000-70,000 barrels of oil equivalent per day (boepd) in 2013.
David Barclay, a divisional director at wealth manager and financial-planning specialist Brewin Dolphin in Aberdeen, said Premier Oil’s latest update was greeted with a rather indifferent response by investors, finishing the trading day off 1.3% at 366.4p.
He added: “The shares have underperformed their larger peers over the last year, after losing support of some shareholders following the Falkland Islands farm-in in July and a patchy exploration performance throughout 2012.
“That being said, there are a large number of potential exploration catalysts over the next 12 months. While production targets were missed, this was extremely marginal.
“Overall, the update contains more positives than negatives, although judging by the outperformance of the stock since the middle of December and the previous trading update in November, most of the important news released today was already priced in.”