Thursday, 14 January 2010

Panax Geothermal recommences mobilisation of drilling rig
January 11, 2010

Geothermal company Panax Geothermal (ASX: PAX) has recommenced mobilisation of the Weatherford International rig from the Cooper Basin to the Salamander-1 drilling site at Penola in South Australia. As previously advised, the mobilization process was delayed on 21 December 2009 as a result of adverse weather conditions in the proximity of the Paralana drilling site, where the WDI Lightning Rig # 828 is currently being de-mobilised.

Managing Director Bertus de Graaf said the adverse weather conditions rendered the roads impassable to transport trucks for a period of approximately 20 days, resulting in the inability of both Panax Geothermal and WDI to transport critical components of the rig away from the Paralana site. "These adverse weather conditions have now passed and road conditions have been restored to allow transportation to re-commence," Mr de Graaf said.

He said Panax Geothermal formally advised WDI of the cessation of the Force Majeure event, which was invoked to minimize the company's exposure to any unforeseen costs, with effect from 6.00 am this morning. "Panax Geothermal and WDI have continued to work together in a mutually co-operative way during the period of the Force Majeure event to ensure that as many activities as possible were able to be completed during this period," he said. "Panax Geothermal looks forward to the spudding of our Salamander-1 well later this month."