Givot Olam Oil Exploration LP (TASE:GIVO.L) today issued another update about its Meged 5 well near Rosh Ha'Ayin, saying that it will frac section 1 of the well to improve oil production, at the recommendation of experts.
Fracing is a technique that uses a high-volume pump to special fluids into the bore. This creates enough pressure to crack or fracture the formation. The fluid often contains material, such as sand, which remains in the well after the fluid pumping is stopped. The remaining sand allows the oil to move more freely up the wellbore.
Givot said that the frac equipment and team were already in Israel, and that it had begun the preliminary activity for the procedure.
After trading yesterday, Givot published its financial report for the first quarter of 2010. The company posted a net loss of NIS 12.3 million, compared with a net profit of NIS 1 million for the corresponding quarter of 2009. The company has no revenue, and its cash reserves are mainly from public offerings to financing its oil exploration activity.
Givot's share price fell 4.7% by midday today to NIS 0.06.
Published by Globes [online], Israel business news - www.globes-online.com - on May 31, 2010
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