With projected total depth of 3,850m likely to be reached in up to 90 days, the M-16 well will target a prospect with multiple potential reservoir units in sediments of Carboniferous age.

An appraisal well will target a structure defined by 3D seismic with stacked reservoir units in the Bashkirian and Upper Serpukhovian that tested natural gas elsewhere within the Makeevskoye field, while an exploration well will evaluate the hydrocarbon potential of deeper formations in the Lower Serpukhovian and potentially in the Visean.

The M-16 well is located 6.7km to the northwest of the Makeevskoye-21 well which was drilled and cased as a potential gas producer in this year’s first quarter and put on production at an initial rate of 1.7 million cubic feet per day (Mcf/d) (1.2 Mcf/d net to Kulczyk) in early August 2012.

Kulczyk Oil Ventures executive vice president Jock Graham said, "The contracting of a second drilling rig to accelerate the 2012 drilling program is a reflection of the Company’s optimism regarding the potential upside in our business in Ukraine."

The drilling of M-16 well marks the first time that the Kulczyk has had two drilling rigs operating simultaneously on its Ukraine properties.

KUB-Gas has a 70% effective ownership interest in the project.