Only a few weeks ago, Highlands raised almost £3mln of fresh capital to fund that first well.
Given the “strong shareholder uptake” in an open offer later on in July – which was not previously included in the group’s budgets – Highlands has now been able to spud two wells at East Denver.
It will first drill and case the Wildhorse well, designed to target the Niobrara B horizon, before immediately shifting the rig to drill and case the adjacent Powell well, which targets the Niobrara C formation.
At this point, Highlands said it will then continue drilling out the remainder of the deeper Powell well, which will allow it to gain valuable data about the shallower Wildhorse on the way down.
Drilling and casing Wildhorse is expected to take several days, while it will take another day to walk the rig over to Powell where drilling operations will last for another two weeks.
Drill programme within two miles of ‘highly productive wells’
“This is a major milestone for Highlands,” said chief executive Robert Price.
“Given that our drilling location is located within two miles of highly productive horizontal wells in the Niobrara shale coupled with our third-party engineers' confidence in East Denver's reserves, we are incredibly excited to see the result of our first well in a potential 24 well drilling programme.
“If successful, we look forward to delivering our shareholders' first oil, first gas, and first revenue.”
Certain professional advisers to be paid in shares
In the same stock market announcement, Highlands said some of its professional advisers have agreed to be paid for their work in shares.
This allows the company to devote more of its cash resources to the project, Highlands added.
Shares were up 2.9% in late afternoon trade to 21.6p.
--Updates for share price--