05 February 2016
Greka Drilling Limited (AIM: GDL), the largest independent and specialised unconventional oil & gas driller in Asia, is pleased to provide an operations update to 31 December 2015.
- 62 wells were drilled in 2015 (2014: 45 wells) a 38% increase YOY, of which:
- 53 wells drilled in China (2014: 38 wells)
- 9 wells drilled in India (2015: 7 wells)
- 51 wells drilled for Green Dragon Gas Ltd. (“Green Dragon Gas”) (2014: 18 wells)
- 11 wells drilled for other clients (2014: 27 wells); Essar Oil Limited (“Essar”) in India (9 wells) and PetroChina in China (2 wells).
- A total of 76,690 metres were drilled in 2015, a 31% increase over 2014 (58,520 metres):
- 66,770 metres were drilled in China
- 9,920 metres were drilled in India
- 62% of the metres involved the use of MWD directional tools (i.e. were lateral or directional wells using measurement-while-drilling).
- The average drilling time for LiFaBriC lateral wells from spud to completion was 32.3 days in 2015 compared with 37.0 days in 2014.
- Strategic conclusion that, outside of existing Greka Drilling markets, Europe and Australia have the highest potential for the Company’s services in the near future.
- Greka Drilling continues to emphasize training, with 27,624 man-hours of training conducted in 2015 for staff in China (2014: 20,266 man-hours) and Indian crews were brought to China for training in drilling LiFaBriC wells.
- Strong HSE focus, no Lost Time Injuries occurred in 2015.
2016 OPERATIONS OUTLOOK
- Focus on Green Dragon Gas contract for the continuation of their LiFaBriC Optimization programme.
- Reduce fixed costs while retaining talent through the first half of 2016, which is expected to have limited activity.
- Continue to focus on attaining third party contracts in China and India.
- Continue the active discussions with Essar about further drilling in India at the Raniganj East block, West Bengal following the conclusion in 2015 of the Company’s earlier Essar contract with a total of 16 wells being drilled.
- Monitor the assessed opportunities to expand into new geographies and ensure stability and investment certainty prior to any expansion execution.
Randeep S. Grewal, Chairman and Chief Executive of Greka Drilling, commented:
“We are pleased to report that we drilled over 30% more metres and wells in 2015 than in 2014. In addition our drilling efficiency continues to improve as evidenced by the ongoing reduction in the drilling days per well. Our performance in December was demonstrative of the Company’s capability and optionality, with 13,200 metres drilled in China utilizing only eight rigs.
Although the CBM production business in China remains one of the most attractive gas production markets in the world, and we remain bullish on the medium to long prospects for CBM in India, Greka Drilling is not immune to the crisis that has hit the oil & gas industry. Thus, we continue to focus on taking actions to reduce our fixed cost base during the industry downturn and push towards a business that has a primarily variable cost structure, strong operational optionality and diverse client base.”
For further information on Greka Drilling, please refer to the Company’s website at www.grekadrilling.com or contact:
James Henderson / Rollo Crichton-Stuart
+44 (0)20 3772 2500
Dr Azhic Basirov / David Jones / Ben Jeynes
Smith & Williamson
+44 (0)20 7131 4000
+44 (0)20 7614 5900