Australian gas explorers battle rig shortages in US operations

THREE ASX-listed companies operating in the United States – Antares Energy in Texas and the Nuenco NL and Orchard Petroleum partnership in California – are having to work around rig availablity problems in their drilling operations.
Australian gas explorers battle rig shortages in US operations Australian gas explorers battle rig shortages in US operations Australian gas explorers battle rig shortages in US operations Australian gas explorers battle rig shortages in US operations Australian gas explorers battle rig shortages in US operations

The booming US gas sector has made drilling rig availability restricted and unpredictable. But even so the potentially huge rewards for small to mid-sized companies make any difficulties seem trivial, said Antares managing director Howard McLaughlin.

“We have to be flexible and ready to move at any time, because we just don’t know when we can get the rigs,” he said.

Antares has responded to this situation by preparing all its current potential drilling sites so that if a rig becomes unexpectedly available work can start immediately, and by trying to contract multiple rigs to drill multiple wells.

It has been a frustrating waiting game, but the company has finally contracted some rigs and may soon have three rigs working simultaneously.

Antares Energy is already producing from two commercial gas wells in Ellis County, Oklahoma and announced yesterday that a drilling contract has been signed for two more Ellis County wells.

Ellis-3 and 4, are the fifth and sixth wells planned for drilling in an ongoing USA drilling program. Both wells will be drilled to a depth of about 12,500 feet.

The contract is for two firm wells and an option to consider two additional wells. Antares Energy holds an 88% working interest in the first well.

“The drilling rig will begin moving to the first location next week and Ellis-3 is expected to spud the following week,” McLaughlin said.

The drilling contract includes an option to drill an additional two wells subject to agreement on terms and conditions with the drilling contractor, Nabors Drilling.

“We are very pleased to be able to acquire a drilling rig in an extremely competitive rig market,” McLaughlin said.

“We will soon have two rigs active, with Porters Creek having spudded earlier this week, and possibly three rigs working simultaneously, as we expect to see Yukon-1 also beginning in the not too distant future.”

Meanwhile in California, Nuenco NL has said the partners in the Jack Hamar gas project have set casing on their four appraisal wells in anticipation of a planned testing program.

“The joint venture has endorsed the aggressive approach of the operator to keep the rig drilling rather than stop it – and potentially lose the drill rig – while it brings in a service rig to test a well before proceeding,” Nuenco managing director Anthony Kain said.

“The operator had decided to case the wells instead of using packers as the multiple sticky clay zones posed a threat of getting stuck down hole. We are very happy now to have four appraisal wells with steel casing set and cemented in place that have come in on time and on cost and which we will start to open up this week to define this gas play."

Nuenco said results from mud logs and electronic logs provided multiple zones to examine in this testing program, justifying this approach to drilling and testing.

Interests in Jack Hamar are Nuenco LLC 37.5%, Orchard Petroleum Inc 37.5% and Nahabedian Exploration Group LLC 25% (operator).

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