The Directors of Armour Energy Limited (ASX: AJQ) wish to advise that the first well in the program in the McArthur Basin drill program in Australia has encountered gas shows in the Reward Dolomite unit in the highly prospective Batten Trough. The Batten Trough is covered by granted EPs 171 and 176 (100% Armour Energy). The tenements cover 11,000km2 and are the subject of an independently assessed mean technically recoverable prospective resource of some 18.6 TCF (Trillion Cubic Feet) of gas.
Cow Lagoon 1 (Armour Energy 100% and operator) has encountered gas from indeterminate zones in the Reward Dolomite between 342 and 540 metres depth. The gas show was encountered during air mist drilling in a tight calcite cemented dolomitic shale with poor porosity and permeability. The flare shown in the photograph above is driven from the well by the reintroduction of compressed air into the well after the connection of an additional pipe into the drill string during drilling.
The well is being drilled to test the oil and gas prospective middle-Proterozoic aged sedimentary rock section to a maximum target depth of 850 metres. The well is sited on an anticline defined by a previous seismic line. The well is to date encountering the various prognosed gas and oil prospective formations at predicted depths, and is expected to enter the main targets in Cow Lagoon 1, being the Barney Creek Shale and the Coxco Dolomite formations, at 620 and 720 metres depth, respectively.
Over the next week to 31 May, Armour expects to complete the Cow Lagoon 1 well by collecting cores through the Barney Creek Shale and Coxco Dolomite to test for thermal maturity, organic carbon content, liquids and gas content.
The drilling rig will then move to the Kilgour Anticline in the centre of the southern potentially liquids-rich gas window and test the same prospective units at a deeper level of approximately 1,700 metres. This will be followed by wells in the Abner Range and then Glyde 1, which will provide a confirmatory test of the Glyde River 9 wet gas discovery from 1979.
Armour is targeting liquids rich gas discoveries across the entire central portion of the Batten Trough in order to define gas resources as the first step in the definition of commercial gas reserves by 2013.
Armour expects to provide updates on progress on the well and any oil and gas occurrences as the Barney Creek Shale and Coxco Dolomites are cored.
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