The Company has substantially completed construction of the initial phase of its southern extension to the existing pipeline and facility infrastructure and expects to place the Ducros No. 32-1 and the previously announced BML 22/SL 17980 No. 1 wells on production within the next two weeks. Combined test results from the Ducros No. 32-1 and the BML 22/SL 17980 No. 1 wells were 26.8 Mmcfe per day (17.4 Mmcfe, net). The next phase of the pipeline and facility tie-in is in progress and the Company anticipates completion by early September whereupon the previously reported BML No. 7-2 well will be placed on production. The BML No. 7-2 well was previously tested at a rate of 13.3 Mmcfe per day (8.6 Mmcfe, net).
Meridian continues to focus on its exploration and exploitation of the BML project area in addition to the development of its Weeks Island field and its other properties which comprise an asset base consisting of approximately 8,000 square miles of 3-D seismic data. The Company plans to begin utilizing a third drilling rig in the BML project area as early the fourth quarter of 2004 and plans to increase its capital expenditures budget approximately 15% from $95 million to as much as $110 million over the balance of the year.
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