Strike Energy (ASX:STX) and Talon Energy (ASX:TPD) green-light Walyering project development

• Joint venture partners Strike Energy (STX) and Talon Energy (TPD) will proceed with the commercial development of the Walyering conventional gas project in the Perth basin
• The official final investment decision follows an independent certification of gas reserves for the Walyering gas field and a review of the project’s economic feasibility
• The partners forecast the project development to cost around $14.4 million, with Talon commencing discussions with potential debt financiers
• Meanwhile, Talon says gas marketing activities are advanced, and offtake contracts are expected to be finalised in the fourth quarter
• Shares in Strike Energy are up 1.79 per cent to 28.5 cents at 10:45 am AEST, while Talon is up 10.71 per cent to 15.5 cents at the same time

Joint venture partners Strike Energy (STX) and Talon Energy (TPD) have made the call to proceed with the commercial development of the Walyering conventional gas project in the Perth basin.

The final investment decision followed an independent certification of gas reserves for the Walyering gas field and a review of the project’s economic feasibility.

The partners have completed front-end engineering and design (FEED) at the project and said detailed design was nearing completion.

The development of the project will see the completion of the Walyering 5 and 6 wells, with production to be processed on-site.

Strike and Talon forecast the project development to cost around $14.4 million, and Talon has already kicked off discussions with potential debt financiers over Walyering.

Talon said gas marketing activities had advanced, and offtake contracts were expected to be finalised in the fourth quarter of this year.

In addition, the company plans to undertake a strategic review of the Perth basin to guide its exploration strategy in the future.

Talon CEO and Managing Director Colby Hauser said with the final investment decision, the company had made a rare transition from explorer to producer.

“The project showcases a quick, low-cost development which will see Talon generating significant cashflows from early 2023 in an environment where access to capital is increasingly difficult,” Mr Hauser said.

Strike is the operator of the project and owns a 55 per cent interest in the JV, and Talon owns the remaining 45 per cent.

Shares in Strike Energy were up 1.79 per cent to 28.5 cents at 10:45 am AEST, while Talon was up 10.71 per cent to 15.5 cents at the same time.