The Canadian-based oil and gas group said its partner and operator of the prospect, Pan American Energy, has re-entered the Vaca Muerta shale formation after mobilising a drilling rig.
The rig will drill horizontally for about 1,500 metres and will target the Vaca Muerta unconventional oil resource play at a vertical depth of about 3,200 metres.
Once drilling has been completed, Pan American will mobilise supplies, services and equipment to complete the well in 19 stages of hydraulic fracs.
Madalena estimated the cost of the horizontal multi-frac re-entry at US$9.8mln, including the expenses of drilling, completing and equipping the well.
Pan American is going to cover the costs for drilling and fracking operations, with the first well potentially spudding later in this quarter.
Madalena will receive US$5.6mln in carried capital costs through the work programme.
Story by ProactiveInvestors