CAMAC announced the spudding and progress of its ZJS-3 well in China. Drilling is expected to take between 40 and 60 days to reach the well's target depth of between 4,500 and 5,500 feet. Currently the penetrating depth is 3,300 feet drilled towards the main target formations. Mud logs have already shown gas readings from several penetrated intervals.
In January 2011, CAMAC Energy and its Chinese partner, PetroChina CBM Co., approved an aggressive work program to expedite exploration and delineation of the gas resources in the Zijinshan contract area. The work program consists of drilling three additional wells and conducting a seismic reinterpretation integrating the data obtained from recent drilling. The ZJS-3 well is the first of the three wells planned to be drilled in 2011.
Abiola L. Lawal, CFO and Executive Vice President of CAMAC Energy, commented, "We are very pleased to announce the spudding of this well. The timely start of the drilling operation is critical to ensure completion of the 2011 work program which is an important step towards commercialization of the asset. We intend to flow test this well and will use the results to help firm up succeeding wells during 2011."
The Company's Zijinshan Gas Asset covers an area of 175,000 acres in the Ordos Basin in the Shanxi Province, the second largest petroleum bearing basis in China. It is in close proximity to major infrastructure, including the West-East Gas pipeline and the Ordos-Beijing Pipelines.
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