Bridge Resources Corp. reported that the Durango Project, managed by ADIL, remains on target for first gas production October, 2008. The Technip Apache pipe laying vessel is scheduled to arrive later this month with the CTC Volantis umbilical laying vessel and the Bluestream Northern River diving support vessel scheduled to arrive early September to complete hook-up of the 14.3 km pipeline between the Durango well-head and the Waveney Platform. Modifications to Waveney Platform, including installation of the Durango sub-sea controls, are being undertaken by ODE under authorization from the platform operator Perenco (UK) Limited.
Bridge will have invested Pounds Sterling 80,000,000 in the UK North Sea from inception in 2005 through first Durango gas production with approximately Pounds Sterling 67,000,000 of this amount on Durango capital expenditures. The management estimated proved and probable reserves finding and development costs for the Durango expenditures are $2.98/mcfe (15.8p/therm) Durango expenditures. Bridge has secured an initial gas price insurance hedge of 50p/therm ($9.73/mcf) for 5.0 BCFG production and plans to supplement this with additional gas and condensate commercial hedges as market conditions warrant.
Subject to rig availability and other factors, Bridge plans to re-invest a significant portion of Durango cash flow in its 2009 six-well drilling portfolio comprising one gas development project appraisal well, three additional Southern North Sea Gas Area exploration wells, and two Central North Sea Oil Area exploration wells. Bridge plans to retain a minimum 50% working interest in the six wells and is currently requesting gross well costs from drilling management companies prior to securing partners.
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