AGM ReportAt this morning's meeting Mr. Laracy gave a brief overview of exploration plans for the West Coast.First well will be drilled on the Storm prospect, followed by two wells on the Hurricane.These wells will be approx. 800m to 1000m deep.Two other wells are being considered for Fall drilling once results of the first three wells are known.The latest seismic shows a large number of targets on these tow prospects.It appears that the industry standard is 3 barrels of recoverable oil per sq.mile...giving the Hurricane prospect a potential 300 million barrel potential.Drilling of these prospects will occur in sequential manner commencing around late June.The drill rig deal that Vulcan has entered into is expected to close within a week or so.
At the present time contractors are preparing the drill sites i.e clearing properties and installing drill platforms.Vulcan has had a good response to the advertisements for drilling personnell, and is currently completing the hiring for the named positions.
Mr. Laracy also mentioned that Vulcan is in negotiating stage of bringing on another director with significant industry experience in the oil patch.Additionally the Company is looking at purchasing assets outside of Newfoundland, and we can expect to see value-added deals for the Company in the near future.
Several questions about the drill rig were asked .Mr Laracy pointed out that Vulcan decided to purchase its own rig due to the exhorbitant cost of mobilizing/demobilizing a suitable rig from Alberta($700,000), and also the high-day hiring rates.He further indicated thatit is not unusual to see companies exploring in frontier areas purchase a rig.This approach enables a company to control costs, dilll anytime, and often times get a" bigger bang for the buck" .
On a separate matter, Mr. Laracy indicated that he expects Nortec to announce its drill program for the TL Nickel property in Voisey's Bay in the coming weeks. Nortec plans to conduct further geophysics, and drill approx. 3000-4000 meters in total- a very significant program.The information that has been gleaned from drilling by former owners of the property, along with Nortec's recent gravity and other geophysical work, suggests that this property has exceptional potential to deliver excellent results.
In summary, a very interesting and upbeat meeting of shareholders.My own sense is that this summer will prove to be a very rewarding one for Vulcan shareholders.Hats off to Mr. Laracy and co. for their tremendous work.
Len