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Essar Oil turns to Greka Drilling again

Greka is to do more work on the Raniganj East Block in West Bengal
Essar Oil turns to Greka Drilling again
Essar is a leading producer of coal bed methane in India

Greka Drilling (LON:GDL), the specialised unconventional oil & gas driller, has won a new contract to provide drilling services to Essar Oil.

Essar will be using Greka's services on the Raniganj East Block in West Bengal, India, having previously employed Greka on this project in 2015.

Under the new contract, once mobilised, Greka Drilling will provide two of its high quality semi-automated GD75 rigs to drill vertical and directional wells on a day-rate basis, rather than on a metres drilled basis.

Greka said the drills it intends to use for the job are already in the country.

The contract is for a period of one year and has an estimated value of around US$8 million. The start of drilling operations remains subject to the completion of pre-mobilisation requirements that are currently expected to be complete by end of this quarter.

"The decision by Essar to re-contract Greka Drilling for the Raniganj East project is affirmation of the quality of our technologically advanced GD75 rigs and experienced crews in India.  While we still expect relatively limited activity in H1 2016, we welcome the prospect of new drilling for Essar and further drilling for Green Dragon Gas during the course of the year,” said Randeep Grewal, chairman of Greka Drilling

“In China, 17 LiFaBriC [lined faulted brittle coal] wells remain to be drilled from last year's order for Green Dragon Gas, although the timing of drilling will depend on customer mobilisation instructions. We continue to be optimistic about the prospects for the unconventional gas industry in India and elsewhere and our long-term role in developing this vital domestic major resource as we concurrently continue to do in China," he added.

Essar is a leading producer of coal bed methane in India whose Government has recently reiterated its commitment to developing the country's domestic natural gas resources as a clean fuel.

Shares in Greka Drilling rose 0.5% in the first hour of trading.

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September 27 2016

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