March Resources to Begin Initial Exploration in North Pica

Calgary-based March Resources (TSX-V: MCF) has signed a contract securing a rig for initial exploration wells in its North Pica block in northern Chile's Tamarugal basin, the company said in a statement.

"We are looking to spud the first well around October 1 and we're going to move the equipment from here down to Chile," March president and CEO Dave Antony told BNamericas.

March is committed to investing around US$20mn in a three-well program, he said, characterizing the wells as high risk.

"Work in the oil and gas industry anywhere in Chile has been pretty limited and the area we're in has had very limited drilling in the past," Antony said. "But we're very encouraged by some of the geological information that we know."

March signed a special operating contract (CEOP) with Chile's government to explore for hydrocarbons reserves in the Pica North and Pica South blocks between the cities of Iquique and Calama, BNamericas previously reported.

"The first two targets we picked are both in the North Pica block and reasonably close to each other, not far from the town of Pica," Antony said. "We will drill the first two wells and then evaluate the results. We've got two more targets picked in the North Pica block."

Geological work will begin in the South Pica block at the beginning of 2008, he said.

March earlier reached an agreement with US oil company California Oil & Gas (COGC) to grant the company a 50% interest in the blocks for assuming part of the exploratory drilling costs.

Visit BNamericas to access our real-time news reports, 10-year archive, Fact File company database, and latest research reports. Click here for a Free two week trial to our Latin America Oil & Gas information service.