Calgary-based (field office)DIGG in the news:
(PR NEWSWIRE) Digital Gas Agrees to Sign Three Contracts With Dong Sheng Corp
NEW YORK, Sept. 14 /PRNewswire/ -- Digital Gas, Inc. (DIGG - Pink Sheets)
today announced that it has agreed to sign three oil & gas contracts with Dong
Sheng Corporation ("DSC") of Dongying, Shandong Province, Peoples Republic of
China. The contracts will be for engineering, education and production
sharing respectively. Dong Sheng produces 4 million barrels of oil per year
from 540 wells in 15 fields.
The agreement dated today states that "The partnership objectives are to
improve oil & gas production and field recoveries in all of DSC's fields and
to develop new fields with the best technologies available both domestic
within China and in the International market."
The contract for engineering involves the submission of engineering action
plans for each field and work, such as Digital has agreed to immediately
conduct on several properties of Dong Sheng, including: the design and
implementation of fracturing programs to improve the stimulation of existing
wells; sourcing the correct pumps to handle sand and low production rates;
dealing with wax problems under Digital's quality control systems and,
finally, to work with Dong Sheng on water treatment solutions.
The contract for education involves training Dong Sheng personnel in the
classroom and at the wellsite. The primary focus of Digital is to build and
train cross-functional teams, with the goal of maximizing the exploitation and
recovery of hydrocarbons.
The contract for production sharing allows Digital to earn a significant
percentage of the total production of each field for little or no direct
investment. With respect to the production sharing agreement, Mr. W. Brian
Lunan, a Director of Digital, said that "before signing the agreement, we
conducted our technical audit on one key Dong Sheng field using our
proprietary Stage Gate Process and the field passed our test with flying
colors." "The principals and personnel of Dong Sheng, as well as their highly
prospective 15 fields, are the best we have seen in China to date," added Mr.
Lunan.
A fourth contract for reservoir enhancement is on the table, but will only
be considered after Digital has fully improved the production from DSC's
540 wells under the production sharing agreement. In these fields, reservoir
enhancement would take place at depths in excess of the current limit of
3,000 meters and would entail greater risks and rewards.
This delay in deep drilling allows Digital to build significant cash flows
relatively risk and cost free.
The contract signings are scheduled for the week of October l6th at which
time Digital Gas will turn over the detailed engineering plans for the initial
target fields.
Digital Gas is prepared to go to contract on the same basis with any
qualified company in Asia with highly prospective properties in need of
Digital's state-of-the-art enhancement technologies.
SOURCE Digital Gas, Inc.
-0- 09/14/2000
/CONTACT: Leo Murray of PR Associates, 212-856-4496, for Digital Gas,
Inc./
(DIGG)
CO: Digital Gas, Inc.
ST: New York, China
IN: UTI OIL
SU: CON
*** end of story *** |
