KCA DEUTAG, the international drilling and engineering contractor, has been awarded a contract by Hess Oil France S.A.S with a total firm contract value in excess of €6.5 million.

The contract, which is for KCA DEUTAG's Euro Rig class land drilling rig T-208, comprises the provision of drilling and related services for shale oil exploration campaign in the Paris Basin permits operated by HESS and its partner Toreador Resources Corporation. The contract comprises the drilling of six firm wells in the Paris Basin permits with two further well options and is due to commence in February 2011.

Hans Schröer, KCA DEUTAG's Country Manager for Europe, said,'There is a great deal of excitement about the prospects of unconventional oil and gas plays in mainland Europe, with the world's leading oil and gas companies having acquired significant acreage in countries such as France, UK, Germany, Poland, Hungary, Romania and the Ukraine. Exploration campaigns are already underway and tender activity for suitable rigs has increased markedly in the last six months. Although there are a number of technical and commercial challenges to be addressed to prove the long term economics of these plays, the industry remains hopeful that unconventional oil and gas could represent the same transformational opportunity as it did for the gas supply and drilling sectors in the US.'

Industry sources cite that European unconventional gas resources alone could amount to approximately 1200tcf GIIP (gas initially in place). While at this very early stage industry estimates on numbers of wells and drilling rigs required vary widely, all point to a dramatic increase in the potential numbers of rigs required in Continental Europe.

As Europe's leading land drilling contractor, combined with the industry leading rig building capabilities of sister company Bentec, KCA DEUTAG is uniquely placed to capitalise on the shale oil and gas opportunity.

T-208 is the first of Bentec's Euro Rig series and is built especially for the European market, designed to be in compliance with the latest European regulations, with low emissions, automation and full ATEX certification. The rig is designed for high efficiency rig moves and the modular structure and vertical lift-type mast results in a minimal footprint.

Mr. Schröer continues: 'This is a significant contract award for us and continues our successful drilling operations in France. Furthermore it is the first step into the exciting shale oil and gas sector in Europe which we believe will provide many more opportunities for the company going forward.

'KCA DEUTAG's significant history and experience drilling in mainland Europe, alongside its superior health, safety and operational performance, places the company in an excellent position to support clients in making the best of Europe's shale oil and gas opportunities.'

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