Greka Gets China Drilling Contract

London-listed but Asia-focused coalbed methane driller Greka Drilling (GDL) May 24 said it has won a drilling contract with Shanxi CBM Exploration and Development Branch of PetroChina.

This new drilling contract is to be deployed in PetroChina’s CBM blocks - Fanzhuang and Zhengzhuang - within Shanxi Province and is estimated to have a value of $1.3m, at the minimum, the company said. This contract is part of a 240 well project where the Greka expects to get further wells assigned. This new contract for the Fanzhuang and Zhengzhuang blocks is for one year, consisting of vertical and directional production wells. The drilling is planned to start prior to the end of 2Q.

Additionally, drilling activities continue under the company’s other existing contracts with PetroChina where six of Greka’s GD75 rigs are currently deployed.

In India the company has completed discussions with state-owned ONGC on the Bokaro drilling contract announced in November 2017, and the contract has been terminated, it said. “Greka was fully committed to ONGC’s proposed drilling campaign at Bokaro and had designated rigs and resources and had made the best workforce available for the project. However, the development plan drawn up by ONGC was not in the best interests of GDL and its shareholders,” it said.

However, Greka said it continues its dialogues with a number of India’s leading CBM developers and continues to be confident of being awarded drilling contracts in the expanding CBM market.

“We are very pleased that China’s flagship energy company – PetroChina CNPC has again awarded Greka Drilling another new drilling contract. With significant drilling activity on several of PetroChina CNPC’s CBM blocks, we are playing a key role in executing our client’s drilling programs,” Randeep S. Grewal, company chairman said. “In India, we are indeed disappointed that the Bokaro contract with ONGC could not be put back on the rails. Notwithstanding, we remain bullish on the prospects of entering into contracts with CBM developers in India, including ONGC, under better terms and conditions in the future. The Indian CBM market is developing well under the pricing freedom for CBM introduced by the incumbent government. We continue to see India as an exciting market for many years to come and remain committed to our dual geography strategy.”