Karoon Gas eyes semi-submersible drill rig for Brazilian program.

ASX-Listed Karoon Gas, operator of five blocks in the Brazilian Santos Basin has signed a letter of intent to contract with Dolphin Drilling, for the “Blackford Dolphin” semi-submersible drilling rig.

The final drilling agreements are subject to final negotiations, which Karoon expects to be completed by the end of June.

The letter of intent covers drilling of three wells in Karoon’s Santos Basin blocks, to begin in the first half of 2012, which will be located about 280km off the coast of the State of São Paulo in water depths of approximately 400m.

The “Blackford Dolphin” is a Semi-Submersible Drilling Rig, and was the preferred drilling rig for Karoon’s upcoming Santos drilling program.

Karoon will be targeting several prospects in this drilling program as well as satisfying second period work commitments.

Prospects within Karoon’s Santos Basin blocks contain several large drilling targets that will be announced once it has completed seismic interpretation later this year.

Preparations are currently being carried out to obtain all necessary regulatory and other approvals, long lead items have been ordered and a specialist team of drilling engineers has commenced well planning and pre-drilling engineering.