Elixir Energy (ASX:EXR) advances Lorelle-3 appraisal with multiple Permian reservoirs intersected

Elixir Energy has taken a material step forward in its Taroom Trough appraisal program, successfully drilling the Lorelle-3 pilot hole to a final depth of 3,580 m MDRT and intersecting multiple Permian reservoir targets, marking the completion of Phase 1 of the company’s two-stage Lorelle-3 campaign in ATP2056 in Queensland’s Bowen Basin.

Highlights

• Lorelle-3 pilot hole drilled to 3,580 m MDRT.

• Primary, secondary and tertiary Permian reservoir targets observed on logging while drilling, with associated elevated mudgas.

• Tinowon ‘Dunk’ Sandstone interpreted at a preliminary thickness of 60 m, with 18 m of whole core successfully retrieved from the upper zone.

• Sections of recovered core observed to be high-quality sandstone.

• Wireline logs now to be acquired to confirm reservoir thickness, rock quality and hydrocarbon phase or saturation.

• Planning underway for a horizontal sidetrack of at least 1,000 m, ahead of stimulation and production testing targeted prior to June 2026.

The Lorelle-3 well sits at the centre of Elixir’s strategy to appraise its Basin Centred Gas Play acreage, where the company holds 50% and operates the appraisal well.

Drilling confirmed the presence of the primary Tinowon ‘Dunk’ Sandstone at 3,167 m MDRT, alongside secondary targets in the Overston and Lorelle Sandstones and tertiary potential within the Kianga Group.

Elevated mudgas readings were recorded across all target intervals, with additional mudgas shows observed in the lower Rewan Formation.

Following penetration of the primary target, Elixir pulled the drilling assembly to commence coring operations, successfully retrieving 18 m of whole core from the upper Tinowon ‘Dunk’ Sandstone.

Drilling then continued through both the upper and lower Tinowon ‘Dunk’ intervals before reaching basement lithology at total depth.

While preliminary logging while drilling data indicates a 60 m thickness for the Tinowon ‘Dunk’ Sandstone, the company has emphasised that wireline logs are required to confirm thicknesses, reservoir quality and hydrocarbon phase or saturation.

Attention now turns to the next phase of evaluation, with Elixir having commenced pulling the drilling assembly and LWD out of hole ahead of acquiring a comprehensive suite of wireline logs.

Upon completion of this evaluation program, the company intends to move immediately into Phase 2, which includes drilling a horizontal sidetrack of at least 1,000 m into the primary target, followed by casing, suspension, stimulation and production testing.

The Lorelle-3 appraisal well benefits from Australia’s Federal Government Research and Development Tax Incentive, with qualifying costs associated with drilling, coring, logging, analysis, completion, stimulation and testing eligible for up to a 48.5% refund under the Advanced Finding process.

Strategically, Lorelle-3 is positioned approximately 10 km from Shell’s Dunk-1 well, described by Elixir as the best penetration of the Tinowon ‘Dunk’ Sands in the Taroom Trough.

Elixir is also the largest acreage holder in the Taroom Trough and is currently appraising approximately ~2.8 TCF of independently certified 2C Contingent Gas Resources.

The basin’s proximity to the Wallumbilla Gas Hub, multiple pipelines and 25 mtpa of LNG export infrastructure underpins the broader regional context for development.

Looking ahead, investor focus will centre on wireline logging results, followed by execution of the horizontal sidetrack and multi-stage fracture stimulation program ahead of production testing targeted prior to June 2026.

These operational milestones will be central to determining reservoir quality and flow performance at Lorelle-3, and whether the appraisal program can support the company’s stated objective of progressing toward a potential maiden Reserve conversion.

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