With the results from the Holdfast-1 well in the Cooper Basin in South Australia, Beach Energy has booked an initial 2.0 trillion cubic feet (Tcf) of contingent resource for the PEL-218 shale gas exploration program to date.
PEL-218 is about 1,600 square kilometers in size; however, the resource is constrained to 100 square kilometers around each well. Data collected so far indicates that the upper Roseneath and lower Murteree shales are continuous across the PEL-218 acreage.
The resource evaluation includes the Epsilon formation between the two shales, along with the top section of the Patchawarra zone. It does not include upside potential from untested deeper sections in the Patchawarra tight gas sand and the shallower Toolachee and Daralingie formations.
The Holdfast-1 flowed gas at a stabilized rate of 1.8 million standard cubic feet per day (MMscf/d) through a 32-64-inch choke. The flow rate has declined to around 1.0 MMscf/d, as expected.
The vertical well was stimulated by fracturing in seven stages - three in the Roseneath Shale, two in the Epsilon formation, and one each in the Murteree Shale and Patchawarra formation. The results favor horizontal wells for the future pilot and production phases, according to the company.
"We continue to de-risk the area through further testing of our two existing wells and our pilot program set down for 2012," said Reg Nelson, Beach managing director.
The first well drilled into the formations--the Encounter-1--experienced mechanical problems during the stimulation process. The lead time for replacement equipment is about three months. The fracturing process will likely be completed by the end of 2011.
The wells were drilled off-structure to test the play, which confirmed gas saturation in these formations and the probability of a large, basin-centered gas accumulation in the permit, the company explained.
The company estimated the potential shale gas in place in PEL-218 ranges from 40 to 80 Tcf.
Beach is the operator for PEL-218 with a 90% interest. Adelaide Energy owns the remaining 10%.
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