New Standard Energy to Drill in Australia After Securing Rig
New Standard Energy Ltd. (New Standard) announced it will resume drilling operations towards the end of 2013 after it signed a Drilling Services Agreement (DSA) for a firm two well program with the option for an additional two wells at New Standard’s election. This arrangement will provide New Standard with flexibility as operator of all its joint ventures and projects to allocate drilling slots as exploration programs are firmed up over the coming 6-12 months.
Subject to final approvals, drilling will commence at the company’s Merlinleigh Project in the onshore Carnarvon Basin in late 2013, to be followed by up to three wells in the Canning Basin after the wet season in mid-2014.
New Standard chose to commence the DSA at Merlinleigh rather than in the Canning Basin, with a primary consideration for the Company being the prohibitive cost to mobilize and demobilize the rig for one well in the Canning Basin prior to the 2013-14 wet season. New Standard and its joint venture partners have agreed to defer drilling the Goldwyer until next year to allow sufficient time for the parties to assess and agree plans for completing Phase 1 and provide an opportunity for costs to potentially be shared across multiple wells.
New Standard Managing Director Phil Thick said the company was pleased to be headed into drilling activity again after an exhaustive search for a suitable rig and drilling contractor to conduct operations efficiently and safely.
“Securing a suitable drilling contractor in such a highly competitive market is a great achievement for New Standard and reflects the continued dedication and hard work of our team. This is a great result and we are excited to be able to recommence our drilling operations later this year,” he said.
New Standard is confident it has selected the most competitive and competent contractor for its proposed 2013-14 drilling program following a highly detailed due diligence process and proactive two-way engagement with Enerdrill. The decision to contract Enerdrill’s Rig #3 was also supported by joint venture partner ConocoPhillips.
In addition to attractive commercial terms the fit-for-purpose rig, frontier drilling experience and the close geographic proximity as a Western Australia-based company were three important factors when selecting Enerdrill. In addition, due diligence and rig inspections undertaken by New Standard management have confirmed that the rig and drilling contractor are capable of meeting the strict safety and drilling requirements expected by the joint venture parties. New Standard has also reserved the right to undertake further audits and inspections prior to drilling.
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