- Xstate Resources (XST) and Sacgasco (SGC) have signed a drilling contract for the Borba 1-7 Well in California’s Northern Sacramento Basin
- The Graham Rig 5 is now on location, and drilling will commence within the next week
- Borba will be drilled to test multiple stacked 3D seismic anomalies
- The drilling program will take around a month to complete
- On the market this morning, Sacgasco is up 21.1 per cent and trading at 11.5 cents per share, while Xstate is up 27.8 per cent, trading at 2.3 cents per share
Xstate Resources (XST) and Sacgasco (SGC) have signed a drilling contract for the Borba 1-7 Well in California’s Northern Sacramento Basin.
The companies have chosen the Graham Rig 5 to drill at the joint venture project.
The rig is now on location, and drilling will commence within the next week. The drilling program will take around a month to complete.
Drilling will test multiple stacked 3D seismic anomalies in the interval from 3200 feet (975 metres) to 9500 feet (2800 metres) depth.
Xstate’s Managing Director David McArthur says the drilling of Borba has been a major goal of the company for the last two years.
“Borba has always been identified as a technically attractive project and is located in a market that is under supplied and pays a premium for Natural Gas,” he said.
“The timing of the drilling of Borba coincides with a sustained increase in the price of oil and gas and compliments the recent corporate strategy of the Company of increasing its asset base through a growing portfolio interest in attractive production assets,” he added.
It has taken the companies a couple of years to get Borba to this point, mainly due to strong competition for the Borba leases from one of California’s largest companies.
“We have recently been able to acquire the lease coverage on the Prospect and surrounding trends that we desired and have now moved expeditiously to begin
drilling,” Sacgasco Managing Director Gary Jeffery said.
“My view is that Sacgasco is without doubt the best ASX-listed company leveraged to a very Big Gas play. Borba is a most technically compelling, low risk, onshore prospect, located in the massively under-supplied and hence premium priced Natural Gas Market that is California,” he added.
On the market this morning, Sacgasco is up 21.1 per cent and is trading at 11.5 cents per share, while Xstate is up 27.8 per cent, trading at 2.3 cents per share at 10:15 am AEDT.