Arena Resources purchases second drilling rigadmin
Arena Resources, Inc. has purchased its second drilling rig. The rig will be completely refurbished and erected on site at one of the Company’s Fuhrman Mascho (”Fuhrman Mascho”) drill sites in Andrews County, Texas. The 600 horse power drilling rig, capable of drilling to a depth of 9,000 feet, is expected to be in operation by early August and will be the second Company-owned rig working exclusively at the Company’s Fuhrman Mascho leases. The rig will cost $1.6 million; however, with the purchase of additional drill pipe, drill collars and other ancillary equipment, management estimates the total cost will be approximately $2 million.
Since initiating drilling at the Fuhrman Mascho in April 2005, the Company has drilled 165 wells. Because of increased knowledge of the area and the application of new drilling techniques, including the use of diamond drilling bits and down-hole drilling motors, the Company has reduced the drilling time from 6 Â½ – 7 days to 5 days per well with its rig. Arena has had two drilling rigs, one Company-owned and one contract, working full time at its Fuhrman Mascho property since May 2006. The contract rig will not be renewed upon the completion of the current contract, estimated to end mid-June. Management estimates savings of $20 – $25 thousand per well because of the reduced drilling time by using the new drilling techniques.