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- Elixir is accelerating the Taroom Trough’s development as a critical fuel source, a day after the QLD government called for fast-tracking.
- Working with APA to find fastest, most economic path for northern gas.
- Transport of significant amounts of light oil will also be targeted.
Elixir Energy (ASX:EXR), a leading explorer in the “red hot” Taroom Trough petroleum play in Queensland and leading Australian pipeline operator APA Group, have agreed to collaborate to find a path to market for gas from the Lorelle project.
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The collaboration news comes just days after the Queensland government called for “necessary” support on fast-tracking Taroom Trough projects as a crucial new fuel supply source to the Australian market.
Elixir and APA subsidiary APT Management Services have signed an early works agreement to investigate the potential to pipe gas produced from the expandable 40 terajoules per day Lorelle pilot project to the Wallumbilla Gas Hub.
They are also investigating the exchange for wholesale gas trading and a critical interconnection point for nine major pipelines in QLD, linking gas supply from the Surat and Bowen Basins to domestic markets and LNG export facilities.
Elixir’s managing director and CEO, Stuart Nicholls, today said Elixir will also be aiming to produce a very significant quantity of associated condensate/light oil along with the gas from the notional Lorelle pilot.
“A separate path to market and plant study will be conducted to optimise the sale and transport of these liquid volumes into the Queensland refining market in due course,” Mr Nicholls told shareholders on Friday.
The initial study will compare capex, opex, required approvals, and time to serviceability for a pipeline from Lorelle-3H to the Roma to Brisbane Pipeline, which is around 25 kilometres due north, versus a pipeline directly to Wallumbilla, 50 kilometres to the north-west. The plotted program will then include the feasibility works required on the chosen pathway to prepare for an entry into pre-FEED, which Elixir also said will include a Class-V capital estimate and a Level-1 schedule.
This work is a critical input into the evaluation of a potential reserves booking post the flow testing at the Lorelle-3H appraisal well, which will start in June. The study’s expected to take approximately 12-weeks to finalise and complete.
Yesterday, we reported Federal Resources Minister Madeleine King had poured cold water on the Queensland government’s call to fast-track development of the potentially world-class Taroom Trough petroleum play.
Rated by industry experts as having similar tendencies to the U.S. shale plays, which helped the U.S. transform from a major importer to a world-leading oil producer, initial estimates suggest Taroom may hold hundreds of millions of barrels and the potential to supply up to one-quarter of Australia’s fuel needs.
EXR is up +7.14% today, to 15.0¢. Mkt cap $259.9M.
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