Reabold is pleased to announce that Integrity Management Solutions ("IMS") has commenced drilling the VG-6 well at the West Brentwood licence ("Licence") onshore California. VG-6 will be the third well drilled on the Licence, following on from the successful VG-3 and VG-4 wells, which are currently in production at West Brentwood.
Reabold has a 50 per cent. equity interest in the Licence, and is paying 50 per cent. of the cost of drilling the VG-6 well, having earned its equity interest by previously funding 100 per cent. of the VG-3 and VG-4 wells. The cost of the VG-6 well is expected to be fully funded from the revenue generated by Reabold's California business.
Stephen Williams, Co-CEO of Reabold, commented:
"We are very pleased to be drilling again at West Brentwood where we have had significant success with our previous wells. Importantly, the cash generated out of the existing California operations is now funding drilling activities, resulting in a self-funding growth business in California. Success at VG-6 would result in another uplift in cash generation from these assets."