AWE Ltd. reported encouraging flow testing results from the Waitsia gas discovery in Western Australia’s onshore Perth Basin, boosting the company’s shares.
The testing program is designed to determine well deliverability from two conventional reservoir zones and to collect gas samples for compositional analysis.
The first zone being flow tested is the deeper High Cliff Sandstone, where a 23.5m interval has been perforated.
AWE is already yielding strong results from the program, with the first well flowing gas at an average rate of 24.7 mmscf/d.
The news sent AWE’s shares up 18.5 percent in Oct. 7 trade to 86.5 cents. The price boost will be welcomed by AWE after it dropped from a 2015 trading high of $1.57 in May to a low of 59.5c in mid-September.
AWE managing director Bruce Clement said the result confirmed the production potential of the conventional High Cliff Sandstone.
“We now have two successful well tests at Senecio-3 and Waitsia-1, and we are moving forward confidently with our plans for the first stage of development,” he said.
The Waitsia-1 well will now be shut in for a brief pressure build-up survey prior to a series of flow tests at various choke settings, rates and well head pressures.
Following completion of testing on the High Cliff Sandstone, AWE plans to set a plug to isolate the lower interval prior to starting testing of the Kingia Sandstone. The testing program is earmarked to be wrapped up by the end of November.
The Waitsia-1 appraisal well is located about 3 km east of the Senecio-3 well and 17 km east of Dongara.
AWE is the operator and 50 percent owner of permits L1/L2 which contain the Waitsia gas field. Origin Energy holds the remaining interest.
AWE has previously revealed a positive investment decision for the Waitsia field was “likely” given the encouraging results retrieved to date.
In addition to the Waitsia Field, the company has estimated 2C gross contingent resources of 237 Bcf of gas in the Senecio, Irwin and Synaphea tight gas fields in the Dongara/ Wagina formation.
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