Badger Explorer has noted that the first self-burying operation of the Badger Explorer Demo50 version is currently being tested in Denmark. The Company has not experienced any technological set backs with regards to the concept.
The test project is however progressing slower than anticipated due to operational challenges, such as weather and test site conditions. The main functions have been verified and computer controlled drilling has been performed. Subsurface compaction has not yet been tested, but will be undertaken shortly. Going forward, focus will be on improvements of the drilling tool through extensive testing.
With its retained financial strength and on the basis of the Denmark test results Badger Explorer is well underway towards the goal of developing a commercial autonomous drilling unit.
3Q 2008 Overview
The first fully equipped semiautonomous Badger Explorer, the Demo50 version, was assembled in 3Q. Calidus Engineering Ltd – UK, the 50 % BXPL-owned engineering company, has been greatly involved in the development and delivery of the hydraulics and electronic control systems and software. Assembly and comprehensive tests took place in Norway prior to moving the prototype to Denmark.
The Company has not experienced any technological set backs with regards to the concept, which strongly indicates that the self-burying test can be completed as planned with a formation plug created behind the tool. The latter is considered to be a vital part of the Badger Explorer operation.
While the end goal is to develop a drilling tool for use offshore, the Denmark test site is on-shore, thus simplifying the logistics around the operation. The geological structure has however proven to be more loose and porous than anticipated which implies challenges to the compaction operations.
The Company will continue its test program in Denmark and during repetitive tests focus on stabilization and harmonization of and between various functions including preparations for the next version – a Demo125 unit. This unit will be built to take sub-surface temperatures up to 125 degrees Celsius. Such a tool will undergo tests on far greater depths, and these tests are planned to be performed throughout 2009.
The Company's development program is in line with the previously communicated plan.
Badger Explorer ASA and the development program are fully financed. This, combined with the agreements with the oil industry majors StatoilHydro, ExxonMobil and Shell, allows for the company to focus entirely on successfully completing the development program.
The Company has raised equity in a total of MNOK 235 during 2005 and 2007. In addition, the extended partner
As of September 30, 2008 the Badger Explorer Group had a net equity of MNOK 213, equivalent to an equity ratio of 92.2 %. Net cash position was MNOK 185. Combined with the partner agreements this is regarded to be sufficient cash to reach a commercial stage.
The Badger Explorer is a revolutionary new method/device for hydrocarbon exploration, providing substantial lower risk, cost and complexity than utilizing an expensive drilling rig. The Badger Explorer technology has the potential to become "a game changer" when the technology is ready for commercial launch.
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