Half Year Accounts
Brisbane, Mar 11, 2021 AEST (ABN Newswire) - It has been a transformatory period for State Gas (
ASX:GAS) since the beginning of this financial year. The true potential of PL231, in which your board had strong faith, is beginning to be revealed. Despite the best efforts of the COVID-19 pandemic and a La Nina induced wet season, the progress has been remarkable, particularly with the addition of ATP 2062 ("Rolleston West") which was awarded to State Gas by the Queensland Government in September 2020. This new acreage is contiguous with PL231 and adds substantially to the critical mass and upside potential of State Gas' CSG acreage.
As with any new CSG province, a large amount of effort is required initially to "crack the code" of the new coals. Reid's Dome was no different. We now have confidence that we have settled on the fundamentals of the right completion technique for the Reid's Dome coal beds. Our pumps are now designed for the temperature, pressure and coal quality regime we are encountering, culminating in instantaneous gas flow rates approaching 500,000 s cft/day. This is a commercially encouraging result in light of the fact that our minimum economic flow rates are estimated at in the order of 80,00 to 100,000 scft/day.
During the half year, the Company commenced Phase 2 of exploration and appraisal of the Reid's Dome Project. The aim of this phase was to establish the Nyanda area as one capable of early economic development as well as to prove that economic CSG acreage extends from the Nyanda area in the South, to the North West corner of PL231. Phase 2 consists of drilling and completion of Nyanda 7 and 8 and Aldinga East 2, as well as bringing on-stream Serocold 1 and Nyanda 4, following their work-over and implementation of the learnings of the new completion techniques derived from Phase 1.
Importantly, Phase 2 also incorporates two core holes to the North West of Reid's Dome in ATP 2062 at Rougemont to confirm the CSG potential of the Bandanna coals which, in economic terms, would be an extension of the Aldinga/Reid's Dome discovery. "Cracking the code" of the Bandanna coals in ATP 2062 should be relatively straightforward given the analogs at nearby Mahalo and Arcadia. The team is eagerly awaiting the results of these Rougement core holes. To ensure a seamless development path, a Pipeline Survey Licence 2049 has been obtained, allowing the Company to explore both the northern and southern route for a roughly 50 kilometre pipeline required to connect our acreage to the nearest gas trunkline.
We expect to have all necessary approvals to commence the Rougemont boreholes in ATP 2062 by the last week of April. By the end of the current financial year, the Company is aiming to achieve a properly appraised PL 231 and the prospect of being able to confirm a single, wide-scale economic development of our contiguous acreage, including ATP 2062.
This timing could not be more propitious in the light of the ACCC Gas Inquiry of January 2021 confirming the urgent need for new gas supplies in 2023, which is predicted to become critical in 2024. The fact that the Federal ALP draft policy platform also confirms the criticality of gas in a world transitioning towards a lower carbon future is a promising sign of bi-partisanship on this issue. The Federal Government has already named gas as one of its five economic planks to ensure Australia has a robust economic pathway out of the COVID-induced recession.
It would be an understatement to say that the results of our Phase 2 programme have been encouraging: at the time of writing (10 March) Nyanda-4 is producing 252,000 cubic feet per day, Nyanda-7 is producing 6,000, and Nyanda-8 26,000 cubic feet day, and gas flow rates are steadily increasing as the dewatering continues. This was all made possible by the $14.5 million fundraising in October which re-affirmed our shareholders' faith and confidence in the future of State Gas and its place in the market.
To view the full half year report, please visit:
https://abnnewswire.net/lnk/CH2C2958
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.
| ||
|
