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Oilex MD Ron Miller is satisfied with Cambay's progress to date

Miller says Oilex is now a first mover in India, having successfully completed the country’s first horizontal, multi-frack discovery

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Oilex (LON:OEX) managing director Ron Miller declared himself “satisfied” with progress to date on the company’s breakthrough Cambay 77H well in Gujarat State.

Speaking following the launch of the firm’s share purchase plan, he said Oilex is now a first mover in India, having successfully completed the country’s first horizontal, multi-frack discovery.

Currently, the group is testing the well. And having already flowed it on test for 300 hours, it has now been shut-in.

The process is designed to measure “down-hole parameters” such as temperature and pressure that will be used to “refine and recalibrate the model” for the well, Miller said. The data is expected sometime next month.

“Once we do the analysis we will release the information from the time we opened up well to time we finish production test,” said Miller.

“We did not want to give interim results that may be misinterpreted, but we are quite happy with the well results so far.

“We are really geared up and keyed up for the next 14 to 28 days when we recover the gauges and analyse the data and get the preliminary results.”

Miller said the well test was never designed to measure the initial flow rates as the well has been produced for about 90 days.

Instead they will assess “the long-term deliverability of the well”.

“We are making sure we get the right scientific data, rather than things that make headlines,” Miller explained.

“The things that make the headlines don’t always create the same underlying long-term value achieved by collating good scientific data.

“We hope to have a well interpreted, easy to understand statement.”

Earlier, Oilex said it was targeting a $5mln capital raise with the sale of shares to existing investors.

The offer is being partially underwritten by Australian brokers Patersons Securities and DJ Carmichael - so the first $2.5mln of the raise is secured.

Shares will be priced at a 20% discount to the average price (volume weighted) for the five trading days prior to the share issue, and Oilex said eligible shareholders will be able to subscribe for up to $15,000 (£8,250) worth of new shares without incurring brokerage or transaction costs.

The subsequent cash injection will be used to support Oilex's activities in the Cambay basin.

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