Transerv Energy Ltd. has reported encouraging results from the latest well at its Warro onshore gas field drilling campaign in the Perth Basin in Western Australia, sending its shares soaring.
The Warro-5ST well encountered strong gas shows over a gross interval of 175 m (574 ft) and about 130 m (427 ft) of net gas pay in massive stacked sands.
Importantly, the well remains in gas at its total depth of 4,422 m (14,508 ft), which Transerv said reinforced the field’s substantial potential of 8-10 trillion cubic feet (Tcf) in place while suggesting further, deeper resources could be present.
Transerv executive director Stephen Keenihan described the results as outstanding because they extended the known parameters of the gas at Warro, both at depth and laterally.
“The results are very strong and increase the economic potential of Warro significantly,” Keenihan said.
“As well as the presence of thick, gas-filled sands in the southern part of the field, the fact that the well was still in gas at total depth, pointing to additional, deeper, reserve potential, shows the potential for the Warro field to be even larger than previously thought,” he said.
Keeniham cautioned that stimulation and testing still needed to be carried out to determine the full commercial significance of the well, but added that the results were “highly promising.”
The Warro-5ST well will soon be suspended in preparation for stimulation and testing.
While more gas-charged sands are expected deeper in the well, Transerv said Warro-5ST had achieved its prime objective of providing a substantial interval of gas charged reservoir for stimulation and testing.
Importantly, Warro-5ST has deepened the lowest known gas in the field by more than 60 m (197 ft) with the potential for further gas zones to be present in the next 300 m (984 ft) of underlying, untested interval between the well’s total depth and the top of the Cadda Shale.
Warro-5ST is located about 3.5 km (2.2 miles) from previous wells and represents a substantial step-out that has significantly extended the proven extent of the gas field.
Transerv expects to start drilling Warro-6, which is located approximately 3 km (1.9 miles) to the northwest of Warro-5ST, in the first week of October.
West Perth-based Transerv was one of the top oil and gas performers on the ASX in the 2014-15 financial year, increasing its market cap by 106% from $12- to $24 million, underpinned by a solid deal to supply aluminium manufacturer Alcoa with pipeline gas and a joint venture decision in late 2014 to extend drilling and seismic activities in the Warro Field.
Alcoa will receive 65% of any commercial flows, with Transerv holding a 35% stake and operatorship of a project which, if successful, could deliver about AU$150 million, or 18 cents a share, to Transerv.
Transerv shares closed 23.5% higher to 4.2 cents on Sept. 24 on the back of the drilling news.
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