GREEN Dragon Gas is set to drill up to 30 lined faulted brittle coal wells (LiFaBriC) for Green Dragon Gas under an evergreen contract with the company.
UK-based Greka Drilling will drill the wells in the Shizhuang South (GSS) block in Shanxi province of China, using up to 10 existing GD75 rigs.
The award came after Greka completed a 10-well program with the company in 2014.
Of those wells, two were connected to existing infrastructure, four were producing gas and six wells were dewatering.
Randeep S. Grewal, who is chairman of both Greka Drilling and Green Dragon, said the order was a good start to the year for Greka.
“The value of this work order is about US$45 million and is in addition to our existing US$65 million contract for Essar in India, a substantial portion of which will be completed in 2015. We look forward to a robust 2015.”
The first of Green Dragon’s wells to be drilled using the LiFaBriC methodology, the GSS 008 well, which came on line on 21 March 2008, had completed seven years of continuous gas production, with no decline in production rates, Mr Grewal said in a later statement.
The well has produced a cumulative 1.05 billion cubic feet (Bcf) of gas production to date, which he said was a rate of return of 80 per cent based on a realised compressed natural gas pricing.
“Our focus over the last few months has been the preparation for an intensive drilling programme that should support another step-change in production to 12 Bcf by year end. We remain confident that we can deliver on this objective,” Mr Grewal said.