The company announced late last Thursday that drilling operations for Phase 1 of the program at the Judith Basin County property began at 12.30pm local time August 16 on drill hole PH1-3.

Crews began work with a second rig at the PH1-2 drill hole the following day at 3pm local time.

“We are working with an experienced technical team onsite capable of successfully conducting the planned exploration program over the following weeks,” American Power president and chief executive officer Al Valencia said.

“All steps to maximize our chances of success have been taken and given the scope of this ambitious program, we have decided to work with two drilling rigs onsite at all times.”

Earlier last week, American Power announced the selection of Boland Drilling to drill approximately 85 rotary borings at Pace, utilizing direct air rotary drilling, mud rotary drilling if necessary, and coring and plugging. It will provide a 15-foot split barrel NQ conventional core system to perform fluid coring with the rotary rigs.

The entire exploration drilling program consists of 61 drilling sites and a total of 53,875 feet of drilling in three phases. The first phase will include 13 drilling locations, while the second and third phases will total 9 and 39 drilling locations, respectively.

The intent of American Power’s drilling program is to classify significant portions of Pace’s coal holdings as proven and probable reserves, and ultimately to establish sufficient resources to support an operations lifespan exceeding 20 years.

The Denver-headquartered company acquired the 29,000 acres that make up the Pace Coal Project in April 2010.

Estimated resources in place, based on exploration work by Mobil Oil (now ExxonMobil), range from 172 million up to more than 410 million tons of high-vol bituminous B coal.