Neon Energy (ASX: NEN) is well funded to commence a two well development drilling program at the company's wholly owned North San Ardo oil field, located onshore California, U.S.A., after completing a $26 million capital raising earlier in the month.
The onshore oil field development will consist of two horizontal production wells budgeted at US$1.6 million that will be drilled back to back targeting the southern lobe of the field.
Neon anticipates the wells will significantly increase production at a time of strong oil prices.
The wells are expected to take two weeks to drill, complete and commence production.
North San Ardo is located just to the north of the San Ardo oil field which has produced 500 million barrels of heavy crude oil since 1947.
The oil field is currently under the operation of Chevron (NYSE: CVX) and Aera Energy and is subject to enhanced recovery techniques to increase production.
Current production at San Ardo stands at 14,000 barrels of oil per day.
Neon also has several other exploratory sites in California as well as two prospective oil blocks in Vietnam.