A $9.5 million deep-drilling project in California’s oil-gassaturated south San Joaquin Valley, dubbed Project Ekho, began itsfirst test drilling Monday at a site 40 miles northwest ofBakersfield, shooting for a depth of 19,500 feet where itsindependent backers calculate there could be the beginning of somesubstantial new oil and gas supplies, according toBakersfield-based Tri-Valley Oil & Gas Co., operator of theproject, which has numerous Canadian backers.

Tri-Valley’s always bullish CEO, F. Lynn Blystone, said thebiggest well risk with Ekho is not geological but “is downholemechanical drilling and completion risk.” He said that is whyTri-Valley hired Joe Kandle as its president in mid-1998. Kandleholds past experience as a senior drilling engineer on earlier deepdrilling projects in the area back in the 1970s. Since then,Blystone and Kandle contend the technology and equipment fordeep-drilling plays has improved greatly.

Location of the Project Ekho initial test well was pinpointed asbeing southeast of a recent deep well test drilling, Bellevue No.1, that blew out at 17,646 feet Nov. 23, 1998, burning for monthsand inspiring more speculation about substantial supplies beingavailable in the area at depths below 15,000 feet. “MiddleEast(-like) flow rates defied numerous attempts to control (theblow out) until a relief well was drilled six months later,” saidBlystone, noting last year that the relief well flowed gas at therate of 50 MMcf/d.

Tri-Valley’s calculations indicate the potential forundiscovered gas supplies approaching 10 Tcf of high-Btu gas and upto 4 billion barrels of 42-gravity oil.

In announcing the first of its three test wells getting startedseveral weeks behind schedules announced last fall, Tri-Valley saidit now owns the record-setting deep drilled well,Tenneco/Union/Great Basins Petroleum 66X-3, from the 1970s, and itplans “to re-enter to attempt recompletion of shallower, previouslyuntested zones.”

Late last year, other interest in deep-drilling prospects wasevidenced by Occidental Petroleum’s re-entry of a deep formation atElk Hills and by other Canadian investors looking for projects.

Tri-Valley said it has mapped what it believes to be a larger,more prospective structure to the east of the Bellevue blowout,with the support of nine British Columbia-based, publicly tradedcompanies. These companies have funded most of the initial $9.5million for the test well, Blystone said.

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