Miller Energy Resources Inc. (NYSE: MILL) provided an update on its RU-1 well in Alaska.

Cook Inlet Energy (CIE), a wholly owned Alaskan operating subsidiary, has moved Rig 35 over to its RU-1 oil well where the company will perform a sidetrack similar to the one recently completed on its RU-2A well.

The company's proposed sidetrack involves pulling the old electronic submersible pump completion and abandoning the lower part of the well by setting a bridge plug and whip-stock. A window will be milled into the casing at 13,000 feet measured depth and drilling will commence to a new bottomhole location similar to that of the original wellbore or 15,500 feet. Completion will include running a 5.5 inch production liner back to the original 9-5/8 inch casing, cementing, perforating and putting a new electronic submersible pump in place. The company expects to complete the sidetrack on RU-1 and have the well online by early August.

With the production from its existing wells and work being performed this summer, the company expects to remain on track to exit the 2013 calendar year at a run rate over 4,000 barrels of oil equivalent per day*, said Scott M. Boruff, Miller Energy’s CEO, in the release.

In 2012, the Company performed a procedure with its Rig-35 to remove all the old electronic submersible pumps, packers, and liquid level control valves that were creating obstruction in RU-1. The company successfully removed over 35,000 pounds of this material; however, one electronic submersible pump and liquid level control valves could not be removed without risk of damaging the wellbore. Subsequently the company set a new electronic submersible pump above the remaining obstruction with plans to evaluate the well following the next standard periodic electronic submersible pump failure. The new pump was put online in October 2012 and ran successfully until recently requiring replacement. The company has already removed that electronic submersible pump, in preparation for this new sidetrack. Assessing the deficiencies that historically caused less than optimal production, the company has determined that sidetracking the existing wellbore above obstructions remaining in the well's subpar section will remedy the issues and improve flow rates substantially.

Miller Energy Resources Inc. is an independent energy company engaged in the exploration, development, and production of oil and natural gas wells in Tennessee and Alaska. The company is headquartered in Knoxville, Tenn.

*Corrected text from '3,000 barrels of oil equivalent',