Rose Petroleum PLC (LON:ROSE) told investors that activity continues apace on the ground in Utah’s Paradox basin, and it is expecting to drill the first well in the project later this year.
It comes after Rose increased its footprint in the Paradox basin, and as it continues to earn into a 75% stake in an 80,000 acre area. The company highlighted that it has assembled a highly experienced operational team with a successful track record in the region.
Specifically, the team put together and executed a nine well programme directly to the south of Rose Petroleum’s acreage.
WATCH: Rose Petroleum assembles top team ahead of Paradox Basin drilling
An application for a permit to drill is underway for the first well. It is anticipated that the permit would be granted in the third quarter, allowing the drilling to start soon thereafter.
The new operational team has generated new time and cost estimates for the first well, which is now estimated to cost between US$7mln and US$8mln - below prior estimates for US$8mln to US$10mln.
Rose highlighted that talks are underway with industry and financial partners to fund the drilling programme, and it reminded investors of its previous guidance that it “is committed to avoiding dilution to existing shareholders wherever possible.”
Some 60 potential well locations have been identified, across both the existing and newly acquired acreage.
"I am delighted that we've been able to assemble such a capable operational team, with an impressive track record of success in the basin,” said Matthew Idiens, Rose chief executive.
“Significant cost savings have already been identified in the well design and further savings are expected.
"We continue to make excellent progress on the ground and are preparing to drill our first appraisal well before the end of 2018, which will be a key milestone for Rose."