A drilling update from Tuesday afternoon from Dune Energy, Inc. (OTC:DUNR) made traders so desperate that the stock had lost more than half of its value already at market open yesterday.9DUNR.png

DUNR closed Wednesday session at $0.299 for a share, which represents a 55.37% fall down from the previous close. The strong investor disappointment was represented also by the immense share turnover of 13.36 million traded shares, the heaviest volume in the past three years and over 22 times higher than the average for the past 30 days.

Yesterday’s closing price and the daily low of $0.16 are still far above the 52-week low, but the RSI indicator has reversed sharply and may enter the oversold area, indicating that DUNR might break more support levels today.2Dune_Energy.jpg

The press release that caused the tragic fall of DUNR share price concerned the company’s Garden Island Bay Project. After market close on Tuesday, Dune Energy announced that its ORX SL 214#1 well has been temporarily abandoned and left for further drilling at later time, no dates have been given though. According to the press release, the well had costs of $32 million and prior to drilling the company had received $3.9 million in cash recoupments.

As implied by Dune Energy President and CEO James A. Watt, the reason to shut down the well was that the drilling has delivered rather disappointing results so far. What sounds even worse, it looks like the further deepening and side tracking of the well cannot be guaranteed and depends on the evaluation of existent data.