Join our daily newsletter At The Bell to receive exclusive market insights
- Australian oil and gas explorer Red Sky Energy (ROG) commences works at the Killanoola Oil Project in South Australia after receiving approval last week
- After checking the rods, the company will conduct a short test, and, if successful, the pump will be turned on for the first phase
- During this first phase, the company will be able to discover more about the quality of the oil, the reservoir and also test enhanced oil recovery solutions
- On the market this morning, Red Sky is in the grey, trading at 0.9 cents per share
Red Sky Energy (ROG) has commenced works at the Killanoola Oil Project in South Australia after receiving approval last week.
Recently, the company received approval to begin operations from the Government of South Australian Department for Energy and Mining.
The Killanoola oilfield was discovered by the Killanoola-1 well in 1998 at a depth of 850 metres. Previous flow tests of the well have recorded rates of up to 300 barrels of oil per day.
In May, Red Sky found 37 metres of potential extra pay at the Killanoola-1DW-1 well. This newly-found zone potentially represents a major upgrade to the current five metres of proven pay at the DW-1 well.
The company is now revising a work program at the project to test the new pay zones.
With the Government approval now in place, the rods will be checked to ensure free moving and potentially declared fit for purpose. After this, RedSky will run a short test and if successful, the pump will be turned on for the first phase.
During this first phase, the company will be able to discover more about the quality of the oil, the reservoir and also test enhanced oil recovery solutions.
Once the first phase is completed, Red Sky will re-enter the well to perforate the newly identified 37 metres of potential pay, which could increase the production rate significantly.
Managing Director Andrew Knox is pleased to start onfield activities.
“After an enormous amount of work and planning, it is great to see the Red Sky team onsite to start the testing of the rods at DW-1. We were able to mobilise quickly to Killanoola after receipt of the government approval to commence operations,” he said.
“The team hopes to make quick progress with the testing which will lead to recommissioning the pump and establishing the topside equipment.
“We look forward to keeping you up to date on this journey to extract the value from the resources at Killanoola.”
On the market this morning, Red Sky is in the grey, trading at 0.9 cents per share at 10:09 am AEST.
