Junior gas explorer Blue Energy has announced a significant increase in gas reserves for its ATP814P coal seam gas asset in Queensland’s Bowen Basin.

The company's 2P reserves for the project have jumped by 29 percent to about 2 Bcm (71 Bcf). Meanwhile 3P reserves have jumped by 49 percent to about 8 Bcm (284 Bcf).

Blue described the result as pleasing, noting it had achieved the reserve upgrade in the current low oil price environment while many other operators were witnessing reductions in their reserves.

Blue Energy managing director John Phillips said the reserve upgrade was timely given the growing demand for gas in the Townsville and North Queensland region.

“The company is currently fielding multiple requests from prospective gas buyers for discussions around the timing of development of Blue’s reserves and its capacity to supply into the domestic market in the short-term,” he said.

“The reserve upgrade is especially pleasing, given the point in the cycle (low oil price), our low finding cost and with gas prices on the east coast trending upward toward $8-9 per GJ, the value of Blue’s in-ground undeveloped 2P and 3P reserves is quite substantial.”

Brisbane-based Blue holds a number of permits in the coal rich Bowen Basin which are enveloped by Arrow Energy’s existing Moranbah Gas Project and its proposed new gas development and export pipeline project, opening up potential synergies for Blue’s gas reserves.

Blue has previously said that Gladstone’s increasing demand for gas would bode well for commercialization of its assets.

“For us we can sell the molecules at the well head or sell the gas in the ground to someone else who can develop it. Or we could develop it ourselves on either an export LNG possibility or micro-LNG plant in that area,” Phillips previously told Hart Energy. “There are a number of different commercialization options.”