Greka Drilling Limited Contract Awards and Directorate Changes (3916U)

TIDMGDL

RNS Number : 3916U

Greka Drilling Limited

24 October 2017

24 October 2017

Greka Drilling Limited

("Greka Drilling" or the "Company")

Greka Drilling Secures Two New Contracts

Directorate Changes

Greka Drilling Limited (AIM: GDL), the largest independent and specialized unconventional oil & gas driller in Asia, is pleased to announce that the Company has been awarded two new drilling contracts in China. The first contract is a turnkey contract with Greka Guizhou E&P Ltd ("GGZ") and the other is a contract with Bohai Drilling Engineering Company ("BDE"), a subsidiary of CNPC (China National Petroleum Corporation).

-- The work scope under the US$4.9m turnkey GGZ contract consists of site preparation, supply of all tangibles, services and drilling needed to complete 12 wells. The programme consists of two multi-well pads with 1 vertical and 5 directional wells to be drilled on each pad to an average depth of 850 metres. Two of the Company's GS130 rigs have been mobilized to commence the drilling of the 12 wells, which are expected to be completed by year end.

-- Under the BDE contract, the Company will be a subcontractor to BDE who is the newly appointed principal drilling company for drilling all horizontal wells for its parent company CNPC. BDE, a predominant oil and gas drilling company, has contracted the Company's advanced CBM purpose built GD75 rigs, equipment and expertise to complete horizontal wells over two years with a US$4.2m minimum commitment.

In addition, the Company announces that two of its non-executive directors, David Turnbull and Richard Day, are stepping down from its board with immediate effect. The Company's board now comprises Randeep Grewal as Executive Chairman and two non-executive directors, Bryan Smart and Sean Mulhearn.

Randeep S. Grewal, Chairman of Greka Drilling, commented:

"I am delighted with the signing of these two new contracts in addition to the previous three contracts from CNPC, announced earlier this year. In a strengthening China coal bed methane (CBM) market, Greka Drilling with our advanced GD75 CBM specific rigs is being seen by many operators as the drilling company of choice. With the current contracts in hand we expect to be utilizing seven rigs by year end in China. The signing of the strategic contract with Bohai is a significant event which is expected to evolve into a long-term relationship between the two companies and create many opportunities for Greka Drilling as state-owned companies continue to ramp up their CBM drilling projects.

"I would like to express my thanks and appreciation for the contribution made by David and Richard to the Greka Drilling board, whose reduced size reflects the Company's continued focus on costs while, despite improving prospects, its activity levels remain constrained by sector conditions."

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    [phone] 
 / 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

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October 24, 2017 02:00 ET (06:00 GMT)