Since the start of 2006 Caspian has drilled 4 new wells:
Operationally all four wells drilled have proved to be time and cost efficient, with a low capital cost of approximately USD250,000 per well. The economy of the wells will enable the Company to recover capital costs in a relatively short timeframe, based on production expectations.
The next well to be drilled will be well 104 in the unexplored Block 4. The results of well 105 and 104 should allow the Company to determine the extent of the drilling program for the rest of 2006. In particular, we will look to tie back the new well 105 to our most successful well 103 with more drilling on the salt lake anticipated.
The workover program is also progressively yielding good results:
Overall 8 out of the 9 new wells drilled in 2004 and 2005 are successfully producing – a 85%+ success rate. Increased production from the workover program is now starting to kick in and boost production rates. 2006 has seen higher production rates with the wells drilled this year producing at rates significantly above the wells drilled in 2005.
Commenting on the results, Michael Masterman, CEO of Caspian said: "By revisiting old wells and drilling new wells we have managed to increase production to approximately 300 barrels per day, a 170% increase. Our drilling program is progressing well and we remain optimistic that we can build on the success of the first part of 2006. "
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