Bass Oil (ASX:BAS) shares are on the rise following the announcement of the commencement of the Kiwi 1 Extended Production Test (EPT).
This comes after the company received project approvals and acquired the necessary equipment for the production test.
The company said it aims to mobilise the Wild Desert Rig 4 by late April with the results likely to be revealed about 60 days thereafter. The project forms part of the company’s intention to re-enter the east coast gas market with Kiwi 1 gas flagged to come online at the same time as widespread gas shortages over east as reported in the media.
“The Kiwi 1 EPT marks a significant milestone for Bass’ expansion plans in the Australian gas market. Our primary objective with this test is to gather crucial data to confirm commercial viability and to enhance the potential of adjacent prospects and leads.” Bass Oil Managing Director Tino Guglielmo said.
Upon restoration of road access, earthworks at the site will begin, facilitating the mobilisation of the work-over rig.
Potential market entry
“We’ve received inquiries from several third-party gas wholesalers interested in securing gas from Kiwi. We’re concurrently engaging in negotiations to facilitate gas monetisation once the test concludes, demonstrating the field’s commercial potential.” Guglielmo said.
Originally drilled in 2003 as an exploration well, Kiwi 1 revealed a gas discovery with a flow test rate of 9.6 million cubic feet per day during drill stem testing.
Initially, it was thought that Kiwi 1 had too little gas to be profitable, but after Bass conducted a more detailed 3D survey, the estimate is now around 5.24 billion cubic feet (BCF) of gas on average, and potentially up to 11.5 BCF.
Bass now has greater confidence in Kiwi’s commercial gas potential, helping it lead the way for the company’s entry into the eastern states’ gas market.
BAS shares up around 24.5 per cent, last traded at 5.6c, at 11am AEDT.