Sources inform ''Globes'' that Givot Olam Oil Exploration LP (TASE:GIVO.L) has begun hydraulic fracturing (fracing) of the borehole in sections 2 through 6 of its Meged 5 well near Rosh Ha'Ayin. The estimated cost of the fracing is $1.5 million. The fracing is needed for the long-term production tests and subsequent drilling planned by 2012.
According to the timetable for development of the Meged 5 well, published by Givot in October, the fracing was due to begin in December, to be followed by production tests of sections 7 and 8 of the well, which will cost $ 3million.
A Givot spokesman declined to comment on the report.
In its financial report for the third quarter, published in late November, Givot said that the fracing equipment was due to arrive in Israel in mid-December, and that it could not begin the production tests beforehand. Completion of the production tests will provide a clearer picture of the Meged 5 well's reserves.
Givot's share price rose 2.8% by mid-afternoon to NIS 0.074, giving a market cap of NIS 740 million.
Published by Globes [online], Israel business news - www.globes-online.com - on December 26, 2010
© Copyright of Globes Publisher Itonut (1983) Ltd. 2010