Further, Opal has taken over operatorship from Milagro Exploration, effectively increasing its working interest in the well to 100% with limited incremental investment. While the discovery falls well short of the best case scenario, Opal expects to recover its drilling risk capital and realize a modest 2-3 times return on investment in the completion. Partners that elected not to participate in the completion retain the right to back in at a 25% level on subsequent development wells.
Commenting on the Company's action, COO Tommy Bolin said, "the performance of our team in operating a deep (18,500 ft), high pressure (16,000 psi+), high temperature (440 degrees F) well without a hitch, marks an important milestone in the development of Opal Energy."
Opal is set to commence drilling over the next few weeks on the second of four "Big BCF" targets scheduled for 2007, pending receipt of funds from a key working interest partner.
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