"This is an important development for Pryme to help the company avoid the problems caused by the worldwide rig shortage", Pryme Chief Executive Justin Pettett said.
"If our 3-D seismic shoot in central Louisiana's Turner Bayou is successful, we hope to be drilling in the order of thirty Frio formation wells from March 2007 onwards. The GWD agreement means that one of these rigs can remain working as long as Frio drilling targets are made available on an uninterrupted basis," Mr. Pettett said.
GWD is a newly formed Louisiana company. Its supervisory management has a combined drilling industry experience and time-in-grade of 100+ years. GWD is currently refurbishing two rigs for Pryme's use that will have a working range of 3,000 feet (914 meters) - 9,500 feet (2895 meters) in depth. The first rig is expected to be completed in mid-November and available for use by Pryme with the second rig to follow. The agreement with GWD is for a term of five years and under its terms, GWD agrees to provide preferential drilling services to Pryme.
The agreement between Pryme and GWD is subject to shareholder approval, as GWD is a related party.
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