Zephyr Energy PLC (AIM:ZPHR, OTCQB:ZPHRF) told investors it has received state and federal approvals, effectively greenlighting its planned "twinned" redrill of the State 36-2 well, in Utah.
The company said it will now move to execute a rig contract and will update the market on the expected timeline for the spud of the State 36-2R well upon award of the contract.
"We are pleased to have cleared the final regulatory hurdles for the spud of the State 36-2R well and look forward to next steps, including the execution of a rig contract and mobilisation of operations to the site,” chief executive Colin Harrington said in a statement.
"This is a time of significant activity for the company with the potential to generate substantial new value for shareholders, and we plan to provide regular updates over the coming weeks and months as operations progress."
Zephyr noted that the well’s main objective is to target the same Cane Creek reservoir natural fracture network which was successfully intersected by the State 36-2 well last year.
Substantially all of the cost of re-drilling the well is expected to be covered from proceeds of a prior well control insurance policy.