Oct 19 (Reuters) - Canadian oil and gas producer Niko Resources Ltd cut its full-year production forecast by about 4 percent due to mechanical issues at one of its blocks in Bangladesh.
Shares of the company fell as much as 15 percent to C$11.73 on the Toronto Stock Exchange. The stock was one of the top percentage losers on the exchange.
The company forecast production to be 168 million cubic feet equivalent per day (MMcfe/d) for the full-year ending March 31, 2013, lower than 175 MMcfe/d it forecast earlier.
Niko now expects second-quarter average sales volumes of 173 MMcfe/d, down 9 percent from 189 MMcfe/d in the first quarter.
The company attributed the lower average sales volumes to anticipated natural declines in its D6 block in the Krishna Godavari (KG) basin off India’s east coast.
Output at the D1 and D3 fields in the KG D6 block has dropped to 26 million metric standard cubic metres per day (mmscmd) from 60 mmscmd in 2010.
Production at the block is now projected to fall further to 20 mmscmd in 2014-15. The block has never managed to reach the forecast peak flow of 80 mmscmd.
Niko owns 10 percent of the block, while India’s Reliance Industries Ltd holds 60 percent and BP the rest.
Reliance and BP are the operators of the block.