drilling costs to plummet, page-5

Well, xoc, it's an interesting point about who is beating down who's door to book the GT3000 rig. The information I was going from with that was a brr interview with ckk from a while ago, after a geothermal conference in Adelaide if I recall correctly. Ckk had held a stall there, and their CEO said something along the lines of 'I'm pleased to report that we were overrun with geothermal companies taking an interest in the rig.'

Now, Ckk has just hired a new CEO who comes from the oil and gas drilling side of things and has completed one job (a 1.7m wide hole btw) with two more contracts signed for jobs this calendar year. None of these holes are for geothermal companies (Woodside, AWT, Newcrest). The rig was originally designed to fill a gap in the market in geothermal.

The problem for the geothermals is that the ckk rig is so versatile and adaptable, the geo's have to compete against oil, gas, mineral and waterbore drilling to book the thing, a lot of which are in the middle of a boom, flush with cash and there is a drill-rig shortage.

I would suggest that if the rig keeps kicking goals they will build more and in 1-2 years they will start doing some geothermal jobs. Besides, from what I can see, at the moment, the geothermals either have no cash, or have their own rigs. The joint venture partners are not exactly stumping up big $ atm, and the political 'uncertainty' is a disadvantage for the geo's.

I don't have the technical knowledge to refute dicko, but I think if the rig was specifically designed for geothermal, it will be pretty useful to the likes of ptr in the future. Of course, a 50% reduction in drilling costs is a big call (surely the free market would dictate that it would only need to be $1 cheaper than its competitors). Still, there are big indications that current drilling costs are not an indication of where they will be in 3-5 years when the drilling should really get going for the likes of Petratherm.