10/01/2014 - 15:15

Neon shares tumble on test results

10/01/2014 - 15:15

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Shares in oil and gas junior Neon Energy have been smashed on the ASX after the company said development at one of its exploration wells was unlikely due to poor test results.

Shares in oil and gas junior Neon Energy have been smashed on the ASX after the company said development at one of its exploration wells was unlikely due to poor test results.

Neon said drill stem tests conducted over a period of five days at its Cua Lo-1 exploration well offshore Vietnam had produced undesirable results.

"Although gas flowed during the test, poor reservoir deliverability combined with high carbon dioxide content suggests development of the reservoir at this location is unlikely," Neon said in a statement.

Neon is exploring the block as part of a joint venture alongside operator Eni Vietnam (50 per cent) and KrisEnergy (25 per cent).

The company said data taken from the tests would still prove valuable for the joint venture as it would help determine if the block warranted further exploration.

Neon shares took a massive hit on the back of news, falling 21.5 cents, or more than 75 per cent, to 7 cents.

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