Volga Kicks Off Drilling at Sub-Salt Grafovskaya #1 Well

Volga Gas announced that drilling has commenced on Grafovskaya #1, the Company's first deep sub-salt exploration well in its Karpenskiy License Area, which is targeting two potential gas/condensate bearing prospects in the Yuzhny Ershovskoye structure.

  • The Grafovskaya #1 well is to be drilled to a planned total depth of 5,200 meters.
  • The budgeted time for the operations, excluding any eventual flow test procedures, is 250 days.
  • The well is being drilled with a brand new western drilling rig, LEWCO 450ton operated by Eurasia Drilling, equipped with top drive and high pressure gas rated blow out preventor ("BOP").
  • The drilling will be supported by leading international service companies: Baker Hughes, Schlumberger and certain leading Russian contractors.

The well will intersect two separate potential gas/condensate targets at different depths on which Russian C3 prospective resources have been filed as follows:

Prospect Depth Russian Catagory C3 Resources    
  (meters) Gas (BCM) Condensate (mm tons) Total (mmboe)
Yuzhny-Zapadnoye 3,500-4,000 13.8 1.9 96.6
Grafovskaya 4,000-5,200 42.3 6.1 298.4

Mikhail Ivanov, Chief Executive of Volga Gas commented, "We are excited to have started drilling our first sub-salt exploration well to test the prospect that was among the key motivations in the establishment of Volga Gas.

"Success with this well will be transformational for the business and, added to our existing production, appraisal and exploration portfolio, will firmly establish Volga Gas as a significant operator in the region.

"The management is highly appreciative of the support shown by shareholders in the recent Placing of new shares that enabled us to bring forward the drilling of the Grafovskaya #1 well. We look forward to providing updates on the progress of this well as and when appropriate."