Cairn Energy, based in Scotland's capital city Edinburgh, have announced its first oil find from its Greenland explorations.
Cairn encountered two types of oil, which are currently being analysed, as well as gas at a 4,358m depth from its second exploration well. Although the signs are encouraging, Cairn is not yet ready to declare a major find or the potential scale of the well.
Image: Cairn Energy
The well, Cairn's second in the region, is sited in Baffin Bay in the sea between Greenland and Canada and found oil over a 400-metre section. The first well has been plugged after no discovery was made, although a third Cairn well, T4-1 is already ahead of its drilling schedule.
In all, Cairn have eight well licences and the company, chaired by former Scottish international rugby player Sir Bill Gammell, is set to invest heavily in exploration of the region, having sold its Indian operations to mining firm Vedanta for a proposed £5.5bn ($8.6bn). The discovery certainly helped the company's share price on the UK Stock Exchange.
Surveys of the Arctic seabed estimate as much as 50bn barrels of oil (some 13% of the world's undiscovered reserves) may exist and more than a quarter of the world's undiscovered gas reserves. Cairn, along with any other exploration licence holders, face strong challenges from environmental organisations, such as Greenpeace, who are concerned about the impact of drilling on the largely pristine and unpopulated region.