By the OGJ Online Staff
HOUSTON, June 6 -- GMX Resources Inc., Oklahoma City, signed a 24-month exclusive contract, valued at more than $20 million, for two of Nabors Drilling USA LP's land rigs and crews for development drilling in East Texas starting in mid-June, officials said Wednesday.
GMX Resources will pay Nabors rental of $14,000/day for each rig, with the right to substitute other operators if it is unable to use the rigs continuously. More rigs may be added if warranted, said company officials.
"This arrangement permits us to speed up our East Texas development on terms which we believe are competitive," said Ken L. Kenworth Sr., executive vice-president of GMX Resources.
As part of its aggressive development of East Texas properties, GMX this year has successfully drilled two wells with Cotton Valley, Travis Peak, and Pettit production in that area. The company is drilling proved undeveloped reserves of predominantly natural gas. It has an inventory of more than 400 drilling locations in East Texas, which it believes have potential in the Pettit, Travis Peak, and Cotton Valley formations at 6,000 to 10,000 ft.
Nabors is a wholly owned subsidiary of Nabors Industries Inc., the largest drilling contractor in the world. Nabors companies operate more than 500 land drilling and 680 land workover and well-servicing rigs worldwide. Nabors also operates
37 platform, 11 jack up, and four barge rigs in the Gulf of Mexico and overseas.
Nabors has 59 rigs working in East Texas. The two rigs committed to GMX are working in Harrison and Panola counties of the East Texas basin. Each heavy-duty rig can drill to 12,000 ft, beyond the targeted Cotton Valley formation.