Equipment manufacturer Atlas-Copco has advised the Company that the situation with the drill rig's power head has been identified and that a new and unused replacement gear assembly in excellent condition was located in Pennsylvania and has been shipped via expedited airfreight to Lima for installation under full warranty.
Radial said that the partners in the project are in full accord and plan to move as quickly as possible towards the restart of operations. The Company advises to expect a brief delay of 7-10 days as the manufacturer will conduct a series of thorough tests in Lima prior to release of the equipment. As soon as the operator has been advised of the outcome of the repair, it is planned to proceed immediately in transshipping the equipment overland to coincide with the remobilization of the crew at the well site for reinstallation and subsequent field trials prior to recommencement of operations. Once drilling resumes, the Company plans to reach a target depth of approximately 950 feet within 3 to 5 days and then proceed to logging and production testing the Huaya 100-1X test, which targets an estimated 15.3 million gross barrels of trapped oil reserves classified by third party reserve assessments as Proved Undeveloped.
Management also announce that the Company has engaged Mr. David L Jagger to act as company representative overseeing field operations in Peru. Mr. Jagger brings over 28 years experience in the onsite supervision of drilling operations at remote locations. During his extensive career, he has worked on virtually every kind of operation and terrain including drill ships, jack ups, inland rigs, helicopter rigs, as well as jungle rig setups. He brings additional expertise working on surface, fluid, bottom-hole heat, and lost circulation control. His background includes overall supervision of the transport and rig up of all aspects of equipment on new well sites. He has worked under contract for numerous companies over the years in locations as diverse as Venezuela, Peru, Brazil, Spain, Algeria, and Chad as well as in the U.S.A. at operations in Colorado, Kansas, Nebraska, Oklahoma, Texas, and Wyoming.
In related news from Colombia, Management is continuing its discussions with Maxim Well Services Ltda. The talks center on plans for the recently acquired 20% working interest in the Bosques Block in central Colombia as well as further negotiations surrounding the proposed 20-37.5% working interest in the Canaguaro exploration and production block.
Company President G. Leigh Lyons comments, "Colombia holds great promise for our Company. The investment climate is stable with numerous incentives provided by both the private and public sectors. We intend to maintain our momentum and maximize the opportunities for growth this region presents. We are negotiating and developing plans on a number of issues currently, all of which are firmly focused on the pursuit of increased cash flow and asset value."
Radial Energy identifies, acquires and develops low risk oil and natural gas exploration and development opportunities throughout the Americas. The Company's innovative strategy involves targeting overlooked or under-developed reserves that are under the radar of multinational oil companies and out of the reach of small independents.
The Company targets prospective oil and natural gas opportunities in historically productive regions with a focus on identifying previously drilled but undeveloped exploratory wells that, due to factors at the time of initial drilling including the absence of pipeline infrastructure, lack of modern recovery technology, poor geological or engineering interpretation or low oil and gas prices, were not fully exploited.
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