Adelaide Energy Limited (ADE) has released an updated drilling report on its Encounter-1 prospect in the Nappamerri Trough.

As of Dec. 14 the well has been drilled to a depth of 3,586 meters, which is 39 meters shy of its target depth of 3,625 meters. The primary areas being targeted in the project include the Roseneath, Epsilon and Murteree shales (REM unit) in the Patchawarra formation of the Nappamerri Trough.

"Encounter-1 has to date provided us with enormous encouragement as to the potential of the shale gas exploration play in the Nappamerri Trough,” said Carl Dorsch, ADE’s managing director. “The much larger thickness than anticipated of the Roseneath Shale that was announced last week provides both the potential for considerably larger gas in place numbers and greater ease of stimulating the production of this gas.”

After reaching total depth, ADE plans to begin casing the well.

“The very high mud weights required for the safe and controllable drilling of the well (13.6 ppg rather than 9.0 ppg) together with the constantly high gas shows encountered both prior to and within the primary targets point to large overpressure and/or a high concentration of in situ gas. Either or both scenarios indicate a significant amount of gas in the system,” said Dorsch. “We look forward to the well reaching target depth and the results of the various testing programs which will provide more data on this well over the coming weeks and months.”

ADE has a 10% stake in the project; the other 90% is currently held by Beach Energy Limited.

About Adelaide Energy Limited

Adelaide Energy Limited is an oil and gas exploration and production company with a focus on the Cooper and Otway Basins of South Australia. ADE is the dominant player in the onshore Otway Basin in South Australia, with existing gas production assets, a development program and substantial exploration acreage. The company holds exploration acreage in the Cooper and Maryborough Basins of South Australia and Queensland respectively which are prospective for large gas resources.