Elixir (ASX:EXR) spud at Daydream-2
It was known to be coming, but the spudding of the Daydream-2 Well is still a major milestone for Elixir Energy and the major hub of activity entering a new energy super basin in Queensland’s Taroom Trough.
Already highly productive through conventional discoveries, an academic investigation into the area showed a massive oil and gas source, but with only a small portion trapped in conventional structures, it offered a new idea to claim a multi trillion cubic feet gas play.
A deep coal flow from the well would provide both a large raise to Elixir’s initial contingent 365 billion standard cubic feet resource and claim an industry-wide success for new gas production.
Elixir Managing Director Neil Young said the spudding was just the start of a very exciting period for its shareholders.
“We should hit our target depth a few weeks before Christmas and then head into the New Year with the major stimulation and flow testing program that the well will undergo,” Mr Young said.
“Success will mark a key milestone in opening up very large new gas play in Queensland that that is exceptionally well located to supply both domestic and international gas markets.”
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A success would matter to more entities than just Elixir and its investors. The area is home to several majors, and Elixir has agreed to provide just information from the well to major Origin Energy in exchange for one million dollars in funding alongside a hefty amount of co-funding from the Federal Government.
Australia is increasingly looking toward gas as a primary energy source between coal and renewables, and now spudded, the Daydream-2 appraisal well is now expected to take around a month to reach the planned total depth of 4200 metres.
And after that the well will be extensively logged, cased and then suspended for a major stimulation and flow testing program to begin at the start of the New Year.
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