In a statement, Sun said the truck-mounted rig was moved to the Dos Dedos Prospect, from the El Viejito Prospect, on Friday, which it started drilling later that night.

However, the poor road conditions mean the joint venture is still waiting on a workover rig to arrive to complete the El Viejito-1 well as a producer.

Yesterday morning, the Milagro-1 well was drilling ahead in a 7 5/8-inch hole toward a planned total depth of 5200 feet (1585m).

Milagro-1 is the second in a six-well program targeting shallow gas prospects – less than a depth of 2000m – on the Margarita project, south Texas, with the potential to contain 8-10 billion cubic feet of gas.

The shallow prospects to be drilled are analogues of historic prolific Frio and Vicksburg sands production in the project area at less than 2000m depth, VicPet said.

The program is also a precursor to the beginning of a drilling program expected to start in the middle of this year on more substantial, individual deep reservoirs that have 30-200Bcf of gas potential.

Interests in the Margarita project are Empyrean Energy (44%), Victoria Petroleum and Sun Resources each with 20%, and Wandoo Energy with 16%.