Ensign Obtains More Work for Record-Breaking Rig

Ensign International, the new name of long-established drill rig operator OD&E, is negotiating more work for the largest onshore rig in New Zealand, Rig 41, when it finishes drilling the three Pohokura field production wells next year.

Ed Milne, the New Zealand area manager for Ensign, said that there could be at least another years' worth of work for the rig in Taranaki after Pohokura is completed at the end of first Quarter 2006.

Currently, his company is looking at contracts for its three rigs through to 2007, he said. Rig contracts in the past have usually extended out three to six months.

The New Zealand exploration industry, like most of the rest of the world, is experiencing a shortage of oil rigs as more wells are being drilled while oil prices are high.

Operators were interested in using the big rig while it was still in New Zealand and therefore mobilization costs were lower than importing a rig especially for a deep hole.

He said explorers were interested in using a big rig for either accessing a deep structure or drilling extended reach wells under the sea or even under a town.

Ensign is hoping to be able to use Rig 41 in back-to-back operations, Mr. Milne said.

Mr. Milne also said that Rig 41 is creating a new New Zealand depth record in the second Pohokura well (POW-02) by drilling to 7000 m along hole, beating its own record of 6500m for the previous (POW-01) well. The previous deepest well before that was the Kapuni Deep-1 well, drilled to 5660 m in 1983.

However, Mr. Milne said that the final well (POW-03) beginning at the end of December was programmed to go longer still to 7500 m.

Calgary-based Ensign Energy Services Inc. bought the Sydney-based Oil Drilling & Exploration (OD&E) in 2002. Last month, Ensign changed the name of its operations outside of Canada to Ensign International Energy Services.

OD&E has been operating in New Zealand since 1969.