This follows last week’s loss of the bottomhole assembly in the well, prompting Arc to sidetrack the well from a depth of 912m.

In a drilling report yesterday, the Perth-based mid-cap said Valhalla-1 had since been deepened to a depth of 1224m but the rig was continuing to experience mechanical problems.

Despite these issues, Arc reiterated that the presence of oil shows from a depth of 110-925m was encouraging for the deeper primary objectives.

“They indicate that hydrocarbons have migrated to the Valhalla structure,” the company said.

Arc has a 100% stake in this well.

The company was also forced to abandon testing of the earlier Stokes Bay-1 well in a separate Canning Basin joint venture, due to the arrival of northern Australia’s wet season.