InterOil has purchased a second drilling rig. The 1,500 horsepower heliportable "triple" rig with top drive was originally built by Parker Drilling. Total cash consideration for the rig and an extensive inventory of drilling and oil field service equipment, currently located in New Zealand, is NZD $6.5 million (approximately US $4.5 million).
The new rig is capable of drilling to 16,500 vertical feet and of drilling longer horizontal sections than our current rig. The added depth capacity of this rig, in addition to the top drive system, is expected to add flexibility and efficiency to our drilling operations. The additional rig is not only suitable for development of the Elk/Antelope field, but also adds increased depth capacity and well design versatility to our exploration program. The rig is capable of tripping drill pipe in "triples," which InterOil believes will lead to significantly shorter drilling times. Two rigs in the field are expected to add efficiency to our overall drilling operations as many of the services and equipment can be shared across both rigs.
The Company anticipates moving the rig to PNG in the 2nd quarter, following completion of the transaction and refurbishment of tubular and other rotating equipment.
Phil Mulacek stated, "We are very satisfied with the acquisition of the InterOil's second rig which is outstanding in terms of design and capabilities and is particularly well suited for operations in the area in which our development and exploration activities are being conducted."
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