Asia-focussed independent and specialised unconventional oil and gas driller Greka Drilling announced its annual results for the year to 31 December on Friday, confirming three principal contracted counterparties during the year - Green Dragon Gas and PetroChina Huabei in China, and Essar Oil in India.
The AIM-traded company said 33 wells were drilled in 2016, of which five wells were drilled in China and 28 wells in India.
A total of 39,553 metres were drilled in 2016, down significantly on the 76,690 metres drilled in 2015, the board reported.
On the financial front, the company posted annual revenue of $7.2m, a serious slide from the $29.9m revenue it reported in the year prior, as its loss before tax widened to $9.6m from $7.5m, due to a lack of workload.
Year-end cash and bank deposits of stood at $2.1m, down slightly from $2.4m year-on-year.
Operationally, the average drilling time for LiFaBriC lateral wells in China from spud to completion was 27.5 days in 2016 compared with 32.3 days in 2015.
The board said the average drilling time for directional wells in India from spud to completion was 12.9 days in 2016 compared with 16.1 days in 2015
Greka Drilling also developed LiFaBriC completion with a 3½" steel liner during the period, for Green Dragon Gas' LiFaBriC optimisation programme.
"As anticipated [it was] a very challenging 2016, where our levels of activity experienced a significant decline compared with previous years due to the continued problems of the oil and gas service industry," said Greka Drilling chairman and CEO Randeep S. Grewal.
"The resulting decline in revenue was mitigated by our aggressive cost reduction program.
"Survival of the fittest certainly applied within the industry."
Despite limited drilling opportunities during 2016 in both China and India, Grewal pointed out that the group was still selected by leading CBM development operators in both countries.
"In China, PetroChina and Green Dragon Gas contracted our China team for horizontal and directional wells while in India, Essar re-contracted our India team for its vertical drilling campaign on a day-rate basis.
"The winning of these contracts in both China and India in the face of aggressive competition underscored Greka Drilling's technical superiority and the recognition of the company's excellence and experience in unconventional gas development."
Having endured "the toughest times" the industry had experienced, Grewal said the board was "excited" about its prospects in 2017 and beyond.
"Greka Drilling continues to win contracts in both China and India from operators that are attempting to monetise the very favorable CBM specific policies implemented by both governments.
"In both cases, the governments are focused on domestic clean energy and CBM resources are ideally suited for such a solution."