rigs

Whilst on the face of it it may seem strange that the JV should let go of one rig for a month, so that POE can drill their 100% owned L53-A concession, there is probably a quid pro quo, whereby CVN will then be allowed to take one of the JV rigs for themselves in 2010 to drill the L20/50 Phitsanulok concession that they hold 50:50 with Sun Resources.

There was a lot of talk last year about getting another rig, but the problem that they had at the time was not the availability and cost of the additional equipment, but the lack of additional trained Thai personnel.

When I asked them about this, they explained that they had considered a third rig, but had decided that the disruption of taking skilled men from one of the two crews that they have, to train up a completely new crew from scratch, would cause more problems than it would solve. It was: "If it ain't broke, don't try to fix it!"

This must be even more of a consideration now that they are drilling fairly deep, uncased, horizontal wells, in broken ground, where there is potential for complete loss of drilling fluids, bogged rods, abandoned equipment and abandoned wells. With those sort of difficult drilling conditions, the success or failure of each well is down to the skills and experience of the driller, and you just can't learn those skills in a matter of months. Bad drillers ruin good projects!

The slow and steady, risk averse approach of POE and CVN to these difficult technical challenges is the reason for their ongoing success.

(By contrast, GDN's drilling disaster in Utah 2 years ago was a case study in what inexperience, bad operators and lousy equipment can do to a project's costs)