HOUSTON, Oct. 2 /PRNewswire-FirstCall/ -- Blast Energy Services, Inc. (BULLETIN BOARD: BESV) announced today that its radial jetting rig successfully completed the drilling of two separate fifty-foot horizontal penetrations in a well operated by Reliance Oil and Gas, outside of Abilene, Texas. At a depth of approximately 300 feet, the rig drilled each horizontal lateral in opposite directions (180 degrees) into the targeted producing sand. As a result, the initial natural gas production of the well increased five-fold to approximately 65 thousand cubic feet per day (mcf/d). The radial jetting rig, Blast Rig #1, is currently conducting similar operations on the second well in the drilling program.
"All of the equipment performed to perfection and we are now attempting to stimulate the second well. This represents an important validation for the development of our horizontal completion technology," said John O'Keefe, President and CEO of Blast.
Under the terms of the revenue sharing agreement, Reliance will operate the lateral jetting rig at no cost to Blast and will share 50% of the revenues generated from such rig. The rig has been contracted at a gross rate of $20,000 per well for what was planned to be a five-well Abilene program. In addition to validating the technology, the jetting process also took considerably less time than expected by completing each lateral section in less than one hour.
Meanwhile, operations have already commenced in South Texas on wells Reliance is operating in the Austin Chalk formation. Blast plans to move its rig to that area for a twenty-well program after it has completed its work in Abilene, Texas. With the success in stimulating production, the revenue per well rate is projected to double for the Austin Chalk drilling program.
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This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 (the "Act"). In particular, when used in the preceding discussion, the words "believes," "expects," "intends," "plans," "anticipates," or "may," and similar conditional expressions are intended to identify forward-looking statements within the meaning of the Act, and are subject to the safe harbor created by the Act. Any statements made in this news release other than those of historical fact, about an action, event or development, are forward-looking statements. Forward looking statements involve known and unknown risks and uncertainties, which may cause the Company's actual results in future periods to be materially different from any future performance that may be suggested in this release. Such factors may include risk factors including but not limited to: the likelihood that the customer lawsuits result in meaningful proceeds, the ability to raise necessary capital to fund growth, adequate liquidity to manage operations and debt obligations, the introduction of new services, commercial acceptance and viability of new services, fluctuations in customer demand and commitments, pricing and competition, reliance upon lenders, contractors and vendors, the ability of Blast Energy Services' customers to pay for our services, together with such other risk factors as may be included in the Company's filings on its periodic filings on Form 10-K, 10-Q, and other current reports. Blast Energy Services, Inc. takes no obligation to update or correct forward-looking statements, and also takes no obligation to update or correct information prepared by third parties that are not paid for by Blast.
