Blast Energy Services Achieves Shakedown of Rig With Initial Field Deployment
April 20 2006 - 4:22PM
PR Newswire (US)
HOUSTON, April 20 /PRNewswire-FirstCall/ -- Blast Energy Services
(OTC:BESV) (BULLETIN BOARD: BESV) is completing its first field
test using its new abrasive fluid jetting (AFJ) technology on a
well located in Many, Louisiana for Oracle Operating Company. The
Blast Rig #1 successfully demonstrated the ability to cut through
the steel well casing at approximately 3,000 feet of vertical
depth. The Company was also successful in shaking down the major
systems of the rig but encountered several items in need of repair
and identified others that need design improvements. As a result,
an attempt to jet a large bore perforation into the target
formation was postponed until after repairs to the hydraulic system
and injector head can be made. "Achievement of the rig's first job
clearly confirms the high potential of our abrasive jetting
technology for many kinds of steel and reservoir cutting
situations," said David M. Adams, President & Co-CEO of Blast
Energy Services, Inc. "The field shakedown process has demonstrated
the need to make some equipment repairs and design improvements
prior to deploying the rig for full commercial operations." The
majority of the rig's systems worked very well in its first
down-hole application, especially the newly-designed, proprietary
Formation Access Tool. The Blast Operations team also performed
exceptionally well in rigging up the equipment and in operating the
abrasive cutting system. Great strides were made in improving
operating efficiency and effectiveness of this prototype rig.
Conversely, the coil tubing injector head and the hydraulic control
systems did not perform at expected industry standards.
Improvements to both of these systems will be addressed in a coil
tubing fabrication yard, where the Company will obtain an
independent evaluation of the rig's major systems. Blast has also
identified two main design improvements associated with how the
wellhead equipment can be more efficiently rigged up and how we can
more effectively deploy the cutting equipment into the well bore.
The Company will issue a cost and timing estimate upon completion
of the independent rig evaluation. No changes or repairs are
planned for the Rig's proprietary equipment. "While we are very
pleased with Blast's state-of-the-art technology, as well as their
personnel, we were obviously disappointed at the inability to
laterally jet into our target formation during this initial
deployment," said Alex McCullough, President of Oracle Operating.
"Oracle is eagerly anticipating the re-deployment of the Blast Rig
and it is our belief that the AFJ technology will have significant
positive results." The AFJ rig technology is built upon a
conventional coiled tubing unit and has a surface working pressure
of 20,000 pounds per square inch. It employs a specialized mixing
tank and proprietary delivery system to reach working depths of
8,000 feet. Blast Energy and Alberta Energy Partners jointly own
the AFJ technology, which has many potential applications within
and outside the energy industry. Upon successful deployment and
customer acceptance of the services provided by Blast Rig #1, the
Company may order construction to commence on as many as three
additional rigs. Based upon an average five-day working week, the
Company estimates that each rig should generate gross revenues of
$6 million per year. With this new technology, Blast is now capable
of offering a product line that includes casing milling, large bore
and medium reach perforations, lateral jetting, and specialty well
completion services such as the use of propants and acid
treatments. About Blast Energy Services, Inc. Blast Energy
Services, Inc. is a publicly traded company based in Houston. Our
mission is to substantially improve the economics of existing oil
and gas operations through the application of our worldwide
licensed and proprietary technologies. Using specially fabricated
mobile drilling rigs we intend to operate a commercially viable
energy service business, including: specialty casing cutting,
perforation, fracturing services and lateral drilling with the
potential to penetrate through well casing and into reservoir
formations to stimulate oil and gas production. This service should
provide oil and gas producers with an attractive, lower cost
alternative to existing well stimulation or horizontal drilling
services. Additionally, we are providing satellite services to oil
and gas producers. This service allows them to monitor and control
well head, pipeline or drilling operations through low- cost
broadband data and voice services from remote operations where
conventional land based communication networks do not exist or are
too costly to install. Please visit our website:
http://www.blastenergyservices.com/ . Safe Harbor Statement 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
ability to raise necessary capital to fund rig construction or
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
Form SB-2 and its periodic filings on Form 10-KSB, 10-QSB, and
other current reports. DATASOURCE: Blast Energy Services, Inc.
CONTACT: John MacDonald of Blast Energy Services, Inc.,
+1-281-453-2888, or +1-713-725-9244, or Web site:
http://www.blastenergyservices.com/
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