Elixir (ASX:EXR) shows free-flows no fluke in Queensland Daydream

Elixir (ASX:EXR) shows free-flows no fluke in Queensland Daydream

April 5, 2024 Off By Jack Baker

Elixir Energy believes it has just recorded the deepest unstimulated onshore flow of gas east of the Perth Basin in Australia, coming from the Lorelle Sandstone of its Grandis Gas project in Queensland’s Bowen Basin.

The 4200-to-4217-metre Lorelle section had flowed into the well bore late last year, and after successful diagnostic tests on the project’s Daydream-2 well, Elixir decided to better test its free-flowing capacity.

And the first flow has proven no fluke, with the latest initial testing logging a stabilised flow 1.3 million cubic feet a day and a maximum rate of 2.3MMcf/d – high numbers Elixir expects will materially increase after simulation.

Elixir Energy Managing Director Neil Young said achieving a material stabilised flow rate meant the gas kick from the section was no isolated freak of nature, and was a fantastic result.

“The Lorelle is now expected to be a major contributor to the final results of Daydream-2 – and could really boost the economics of the vast unconventional resources of the Taroom Trough,” Young said.

Elixir Chairman Richard Cottee further unpacked excitement around the discovery.

“Like CSG at the turn of the century heralding the start of a whole new gas play in Australia, this discovery, combined with other activities in the Taroom Trough, may just about herald a new – and very well located – Queensland gas play at a critical time of a looming domestic gas shortage.”

Grandis sits adjacent to the Wallumbilla gas hub, with Elixir’s new idea for a multi-trillion cubic feet unconventional gas play already capturing industry attention.

Halliburton (NYSE:HAL), Origin Energy (ASX:ORG), and the Australian Federal Government have signed funding and research and development deals with the innovative junior, whose work at Grandis has continued to exceed even its own expectations.

A large recent increase brought the well’s prospective resources to 3.6 trillion cubic feet, a number Elixir is aiming to quickly convert into discovered contingent resources.

Preliminary onsite analysis has confirmed an expectedly low carbon dioxide component of 1.6 per cent, and gas samples have been sent for to the lab for testing.

The stimulation phase of the Daydream-2 program is set to begin in the next few weeks and then will be followed by more extensive flow tests.

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