TIDMGDL

RNS Number : 1262D

Greka Drilling Limited

29 January 2018

29 January 2018

Greka Drilling Limited

("Greka Drilling" or the "Company")

Operations Results 2017

Greka Drilling Limited (AIM: GDL), the largest independent and specialised unconventional gas driller in Asia, is pleased to announce its operations results for 2017.

OPERATIONAL HIGHLIGHTS

   --        48 wells were drilled in 2017 (2016: 33 wells), of which: 
   o   41 wells drilled in China (2016: 5 wells) 
   o   7 wells drilled in India (2016: 28 wells) 
   o   13 wells drilled for G3 Exploration ("G3E") (2016: 5 wells) 
   o   28 wells drilled for other clients in China (2016: none) 
   o   7 wells were drilled for Essar Oil in India (2016: 28 wells).

-- A total of 64,192 metres were drilled in 2017, compared to 39,553 metres in 2016, of which:

   o   56,531 metres were drilled in China 
   o   7,661 metres were drilled in India.

-- 81% of the metres in China involved the use of the Company's in house MWD directional tools (i.e. were lateral or directional wells using measurement-while-drilling); (2016: 13%).

   --        In 2017, the Company performed work-overs on 52 wells in the GSS block for G3E. 
   --        Strong HSE focus. No Lost Time Injuries occurred in 2017.

-- Greka Drilling continues to emphasize training, with 4,608 man-hours of training conducted in 2017 for staff in China (2016: 4,184 man-hours) and with 2,022 man-hours of training conducted in 2017 for staff in India (2016: 400 man-hours).

ACHIEVEMENTS FOR CLIENTS

   --        Most meters drilled in a shift by a rig (12h): 407m. 
   --        Most meters drilled in a day by a rig (24h): 559m. 
   --        Fastest well (spud to TD, 793m) was drilled in 3.52 days. 
   --        12 wells were completed in Guizhou, for G3E within eight weeks. 
   --        6 drilling contracts were signed in China, (2016: 1).

2018 OUTLOOK

China:

-- Complete the 35 remaining wells under existing contracts and maintain client relationships with CNPC, G3E and Petrochina for additional mandates.

   --        Increase drilling fleet utilization from 7 to 10 rigs. 
   --        Mobilise second workover rig for G3E and/or other clients within Shanxi Province.

India:

-- Utilize the Company's experienced personnel for further mandates from Indian clients as well as in other geographies.

-- Bring to conclusion contracts with Oil and Natural Gas Corporation (where discussions continue on the possible modification/termination of the Bokaro drilling contract) and Essar Oil.

Randeep S. Grewal, Chairman and Chief Executive of Greka Drilling, commented:

"Though 2017 was still a challenging year, we saw a significant increase in drilling activity during the latter half of the year in China. We expect a stronger drilling mandate during 2018. With firm drilling contracts signed with state owned enterprises, we start 2018 with a materially stronger foundation than last year.

In China, we successfully completed the 2016 contract from CNPC Jincheng, to provide drilling for six horizontal L-Shape wells. Over the course of 2017 we signed an additional six drilling mandates for a total of 70 wells, of which 35 wells were completed by the yearend. With the strong surge in drilling activity in China we expect to secure more drilling mandates and a greater drilling fleet utilization in 2018.

A significant accomplishment was to complete 12 wells within eight weeks for G3E and PetroChina in the Guizhou block to meet yearend objectives. Notwithstanding the tough terrain and rainy season, the drilling teams drilled with precision and on time.

In India, with the pricing freedom around CBM, we would expect to see enhanced drilling activities in the years to come. Our focus will be to build upon our in country presence as the CBM expert and expand our customer base. In the near term, we wish to get transparency from ONGC on its drilling commitment and planned activity. Once past contract matters have been concluded with our current customer Essar Oil, we would hope to enter a new mandate for drilling in 2018. Furthermore, we continue to discuss drilling campaigns with other operators within India."

For more information on Greka Drilling, please visit the Company's website at www.grekadrilling.com or contact:

 
Smith & Williamson 
 Nominated Adviser and Broker 
 Azhic Basirov / David Jones    +44 (0) 20 7131 
 / Ben Jeynes                              4000

This announcement is inside information for the purposes of Article 7 of Regulation 596/2014.

This information is provided by RNS

The company news service from the London Stock Exchange

END

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