Production Update - Reids Dome
Brisbane, Sep 2, 2020 AEST (ABN Newswire) - State Gas Limited (
ASX:GAS) is pleased to advise that gas flow rates from its Nyanda-4 well have now exceeded 100 mscf (or 100,000 standard cubic feet) per day. This encouraging milestone was achieved over the weekend; since then rates have continued to increase, with the gas flow rate yesterday recorded at 114 mscf/d.
As previously advised, the Company has been investigating the potential for a significant coal seam gas (CSG) resource at its 100% owned Reid's Dome Gas Project (PL231), undertaking Phase 1 of an exploration and appraisal programme to confirm the widespread presence of CSG across PL231. The successful Phase 1 confirmed significant coal seam gas across more than 12 kilometres within PL 231 through drilling and testing of three wells, Nyanda-4, Serocold-1 and Aldinga East-1A. It is currently production testing the Nyanda-4 well in the south of the permit and Serocold-1 in the centre1.
Gas production at the Serocold-1 well also continues to build, albeit more slowly. As advised in earlier updates, well damage limited the depth at which the pump could be placed, and approximately 46% of the targeted coal seams are below the pump and will not be dewatered by the test. Rates similar to those being achieved at Nyanda-4 are unlikely from this test, but the gradual increase in flow rates is encouraging.
Confirmed in late August, State Gas is also progressing the planning of an export pipeline from PL231. Following a desktop study of potential routes, State Gas refined the area of its survey licence to the area of the identified routes. Petroleum Survey Licence (PSL) 2049 was issued to the Company over the new area on 27 August 2020, enabling on the ground investigations into the potential routes to proceed. State Gas plans to commence ground investigations and discussions with landowners once current COVID-19 concerns recede. A map of the area of PSL 2049 is below.
State Gas Executive Chairman, Richard Cottee said he was very pleased with the progress of the wells at Reid's Dome.
"Exceeding 100 mscf/d after less than six weeks of dewatering is very promising. Similar results from Serocold-1 are not expected from the current testing program, given the extent of well damage at that site. However, the gradual increase we are seeing in daily production at Serocold-1 is also very encouraging for the future," Mr Cottee said.
"The gas production data is a key input for certification of the gas resource at Reid's Dome. We expect to receive a maiden certified resource from Netherland Sewell & Associates by the end of September."
About State Gas Limited
State Gas Limited (ASX:GAS) (OTCMKTS:STGSF) is a Queensland-based gas exploration and development company with highly prospective gas exploration assets located in the southern Bowen Basin. State Gas Limited's mission is to support east coast energy markets through the efficient identification and development of new high quality gas assets.
It will do this by applying an agile, sustainable but low-cost development approach and opportunistically expanding its portfolio in areas that are well located to gas pipeline infrastructure.
State Gas is 100%-owner of the contiguous Reid's Dome (PL-231) and Rolleston-West (ATP 2062) gas projects, both of which contain CSG and conventional gas. The Projects, together some 1,595km2 , are located south of Rolleston, approximately 50 and 30 kilometres respectively from the Queensland Gas Pipeline and interconnected east coast gas network. State Gas intends to accelerate commercialisation of these assets through the application of an innovative virtual pipeline ("VP") solution which will see the Company transport compressed gas by truck to existing pipeline infrastructure or to an end user.
State Gas also holds a 35% interest in ATP 2068 and ATP 2069 in joint venture with Santos QNT Pty Ltd (65%). These two new areas lie adjacent to or in the near vicinity of State Gas and Santos' existing interests in the region, providing for the potential of an alignment in ownership interests across the region over time and enabling synergies in operations and development.
State Gas is also participating in a carbon capture and sequestration initiative with minerals explorer Rockminsolutions Pty Ltd in respect of EPM 27596 which is located on the western border of ATP 2062. This project is investigating the potential of the unique basalts located in the Buckland Basaltic Sequence (located in EPM 27596) to provide a variety of in-situ and ex-situ carbon capture applications.
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