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Strike Energy (ASX:STX) was the most hotly watched stock even before market open on Monday as Strike Energy updated on its Erregulla Deep-1 well production test results.
Users’ excitement in the announcement thread was palpable – especially given the steep fall in Strike shares it experienced when it drilled a duster in recent history remains firmly in collective memory.
Strike on Monday reported “extremely high” flowing pressures; an underlying rock geology conducive to letting gas be collected from fracturing, no sand or formation water, and low CO2 impurities (compared to its other assets).
The company also stated on Monday that it’s logged one of the highest flowing pressures ever reported in the Perth Basin.
“ED-1 stabilised rates of 53 [million square cubic feet per day] were recorded with a very high flowing well head pressure of 5,515 psi on a 46/64” choke,” the company wrote in its Oct. 21 release.
“Flow rates were limited by surface equipment with well head pressures indicating the potential to stably flow at substantially higher rates and an absolute open flow of 400-450 mmscfd.”
That second sentence is where a lot of excitement is being generated in HotCopper threads – eagle eyed shareholders immediately began comparing flowrates for Erregulla Deep-1 with the company’s West Erregulla-2 well.
That the company predicts it can get even more impressive numbers out Erregulla Deep-1 was also – obviously – a source of bullish psychology.
Strike also buried a line in its announcement that the company has stopped looking at the High Cliff sandstone for now, and could later provide its latest well a second stage at some later date.
“The High Cliff gas discovery, where samples and permeability have been confirmed, will be reserved for a second phase of the well’s life,” Strike wrote on Monday.
Company chief Stuart Nicholls described the overall experience as “exceptional.”
“ED-1 has performed exceptionally whilst on test over the last 3-weeks. The test has confirmed that ED-1 is one of the best wells ever drilled in the Perth Basin,” Nicholls said.
“The well result has significant positive impacts on the West Erregulla field development and the neighbouring prospectivity where Strike has a major 100% owned tenement position”
STX last traded at 21cps.
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