Sydney independent oil and gas producer AWE Energy has announced one of the highest onshore flow rates in the history of the Australian oil and gas industry.
This came after the Waitsia-4 well in the Perth Basin flowed gas at an instantaneous maximum rate of 90 million standard cubic feet per day (MMscf/d) from the Kingia Sandstone and an average of 89.6 MMscf/d on a 96/64 in. choke at approximately 2,395 psig flowing well head pressure over a 23-minute period.
AWE shares soared 7% to 58c on the Australian Securities Exchange (ASX) and closed at 57c on news that Waitsia-4 had produced the highest ever flow rate from the Waitsia gas field, highlighting what AWE said was “excellent reservoir quality and well deliverability”.
In the past month AWE shares on the ASX have risen by 30% buoyed by appraisal test results emanating from its Perth Basin acreage.
AWE said no further testing would be required prior to a final investment decision for stage two development of Waitsia, which is located approximately 228 miles north of the Western Australia capital city of Perth.
Discovered in 2014, the Waitsia Field—a conventional play in the Kingia and High Cliff Sandstone formations—is Australia’s largest conventional discovery for the past 40 years. It has been estimated to contain enough gas to supply the domestic market with 100 terajoules of gas a day for 10-years.
AWE said the testing program was designed to determine well deliverability from the southern extent of the Waitsia field and to collect gas samples for compositional analysis. The zone being flow tested is the Kingia Sandstone, where a 50-m interval (3,370-metres to 3,420-m Measured Depth Below Rotary Table) had been perforated.
“The results from Waitsia-4 are exceptional and the 2017 Waitsia appraisal program overall has been outstanding. We have successfully confirmed a high quality, conventional reservoir system with excellent well deliverability,” AWE’s CEO and managing director, David Biggs, said.
“Overall, these results have exceeded our pre-test expectations and reinforce our plans for the Stage 2 development, particularly the low number of wells initially required and the straightforward facilities design.
“Waitsia-4 completes the sub-surface works program. Results from Waitsia-4 will be incorporated into AWE’s ongoing evaluation of Waitsia reserves and we expect to release a reserves update before the end of 2017.”
Biggs said the success at Waitsia meant the company was now envisaging fewer wells for the project, which is currently in the FEED stage and is expected to be given FID approval by the end of this year.
AWE said the Labor Government’s 12-month moratorium on fracking in Western Australia, pending a scientific study into hydraulic stimulation, would not impact development of the Waitsia gas field.
The company has said its mission statement is to double production, reserves and revenue by 2021 and significantly increase its share price.
AWE’s 50% joint venture partner in the L1/L2 license in the Perth Basin is Origin Energy subsidiary Lattice Energy.