Perth-based Salinas yesterday said that Lombardi 10-27 would be drilled in a northerly direction from the central production pad and would be drilled about 320m to the west of one of the current horizontal production wells, Lombardi 9-27, that had been on production for about four months and produced at initial rates of about 200 bpd of oil.

Lombardi 10-27 was expected to take about two weeks to drill, after which the rig would move to a southern pad location to start the next well in the program, Lombardi 11-27, added the company.

Each additional production well is expected to be drilled at a cost of about $US750,000 - funded from Salinas' cash reserves.

After each well in the program has been successfully drilled, and the rig moved to the next location, that well will be tied into the production facilities, giving a progressive increase in oil production from the field over the 2½ months of the new production program.

"We are looking forward to the production and revenue growth that these four development wells will provide," said company managing director John Begg, who added that Salinas was on target to achieve its projected revenue of over $US20 million during the 2008 year.