It was our expectation that as fluid continued to flow into the bore hole from the perforated intervals, we would initially recover the fluids lost to the formation while drilling and then determine what fluid is actually in the formation, either water or oil. It now appears likely that the formation has not flowed back into the borehole after perforating and that either the flow is being inhibited by some of the materials introduced while drilling or that the perforations have not connected with the higher permeability zones in the reservoir.
The continued recovery of minor amounts of oil while swabbing as well as the technical analysis by both Bounty and Hardman continue to support the likelihood that the zone being tested does contain oil and that further testing is warranted. We have decided to suspend the testing at this time and release the Century rig to allow it to fulfill its commitments to other operators. It is our intention to bring in alternate equipment within a few weeks to undertake the remedial program, either by acid stimulation or if required, re-perforating the zones, prior to continuing the testing program