Shares in Oilex (ASX:OEX, LON:OEX) jumped 40% as its pivotal...

Shares in Oilex (ASX:OEX, LON:OEX) jumped 40% as its pivotal Cambay 77H well flared gas and flowed light oil and condensate following a successful fracking program.

The company said that hydrocarbon flows through the ‘clean-up’ phase were strong, and Cambay 77H exhibits characteristics of a high performance well.

More definitive production testing will begin once the ‘clean-up’ phase is complete and all the water from the fracking program has been recovered. Thus far 40% of the ‘frack water’ has now been recovered.

"We are very pleased that Cambay-77H is exhibiting all of the signs of a high performance well for Oilex. Flowback started very strongly and remains on track to take 2 to 3 weeks,” said managing director Ron Miller.

“The recovery of light oil/condensate with the gas under clean-up flow this early in the flow-back phase is considered positive and the hydrocarbon liquid volume exceeded our expectations.

RFC Ambrian added the recovery of API 50 light crude during flow-back operations is particularly encouraging, indicating higher than expected liquid hydrocarbon production.

Measuring these liquids will provide valuable information regarding the quality of the 8 fracture stimulations and the deliverability of the reservoir.

The main catalyst for the stock over the next few weeks will be the initial flow test of the Cambay-77H well.

RFC Ambrian reiterated its A¢27.9 (15.3p) fair value estimate and ‘speculative buy’ rating on the stock.

Shares were up 2.83p or 43% to 9.35p in London.