Elixir Energy (ASX:EXR) pauses Diona-1 flow testing as resource booking advances

Elixir Energy has provided an interim operational update on the flow testing operations of the Diona-1 exploration well within the ATP2077 Diona sub-block joint venture in Queensland’s Surat-Bowen Basin.

The update outlined a pause in flow testing to mobilise and install artificial lift systems aimed at accelerating recovery of remaining stimulation fluids ahead of recommencement of future testing operations, alongside engagement with Sproule ERCE on booking a Contingent Resource following the successful demonstration of the repeatable recoverability of the Permian gas resource at Diona-1.

Highlights

• Diona-1 flow testing paused to mobilise and install artificial lift systems
• Approximately 46% of total injected fluid has flowed back
• 50–60% fluid recovery target remains in place
• Joint venture has commenced engagement with Sproule ERCE on booking a Contingent Resource
• Diona sub-block covers 375 km² as part of ATP2077

Elixir Energy, as operator and 49% holder of the ATP2077 Diona sub-block joint venture, with XST holding 51%, said Diona-1 has flowed back approximately 46% of its total injected fluid.

The company said the well has been unable to naturally complete this process in order to reach the 50–60% fluid recovery target.

Diona-1 has been cycled over the past week in order to slug fluids to surface, with the company reporting that this process, while consistently producing gas at near-zero impurity levels, has been unable to move the well into stabilised recovery due to the volume of returning stimulation fluid, which has been confirmed by echo meter measurements and salinities of the produced fluids, while shut-in well head pressure is currently measured at approximately 1,600 psi.

The company said well bore fluid levels will continue to be monitored via additional echo meter measurements while the demobilisation of non-essential equipment takes place to reduce the cost profile at Diona.

The joint venture is assessing installation of the appropriate artificial lift method in order to recommence flow-testing of the gas-condensate resource in the future.

The joint venture has briefed Sproule ERCE to book an independently certified Contingent Resource in the 375 km² Diona sub-block as part of ATP2077, with the company saying results achieved to date continue to support the potential for a new material Permian gas-condensate resource in Queensland’s Surat-Bowen Basin.

Elixir Energy Managing Director and Chief Executive Officer Stuart Nicholls commented on recoverability.

“Diona-1 has provided valuable information about the recoverability of Elixir’s greater Taroom Trough gas-condensate and light oil resource.”

Elixir Energy was fully carried for the drilling of the Diona-1 exploration well by Xstate Resources as part of the transaction agreed in 2025.

Diona-1 is located between the Silver Springs Gas Plant and the Waggamba gas field in the Surat-Bowen Basin of Queensland and adjacent to the Waggamba to Silver Springs gas pipeline, with the well described as an unoptimised vertical exploration well that has performed in line with other vertical Taroom Trough wells.

The joint venture is assessing installation of the appropriate artificial lift method to recommence flow-testing in the future, while the independent Contingent Resource booking process is underway within the ATP2077 Diona sub-block.

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