- Strike Energy (STX) and its joint venture partner, Talon Energy (TPD), are proceeding with the development of the Walyering-5 well on the back of positive results
- The pair recently announced better-than-expected results during an appraisal program and have now cemented the casing in place before completing pressure testing
- Recent work, which has remained under budget, has shown the Walyering gas field presents a low capex and ‘fast-to-market’ opportunity to develop and monetise the asset
- Looking ahead, Strike and Talon plan to undertake production testing in the March 2022 quarter to move into production and meet WA’s industrial gas market needs
- Strike last traded 3.13 per cent in the red to close at 15.5 cents while Talon ended the day 5.88 per cent down with shares closing at 0.8 cents.
Strike Energy (STX) has provided an update on the Walyering-5 well which is held in a joint venture (JV) with fellow ASX-lister Talon Energy (TPD).
The oil and gas companies started this week by confirming the presence of high quality, low carbon dioxide (CO2) gas at the Walyering gas field which lies within the Perth Basin.
Strike, the operator of the Walyering-5 well, completed an appraisal of the well after drilling wrapped up and reported thicker and higher quality gas-charged sands across several reservoirs than originally expected.
Since then, the energy stock has cemented the 5-1//2 inch casing in place before pressure testing the casing string.
However, due to the presence of multiple porous gas bearing sands, the joint venture partners have decided to change the completion of the well so it can open, close and isolate the A, B and C sands individually using slickline tools through sliding sleeves.
This will reportedly allow for individual testing of the sands to define their productivity in order to support the best resource/reserve conversion of the Walyering gas field. It will also allow for future flexibility once the field is online.
A further positive relating to the well outcomes is that costs remained under budget. The total cost for drilling and evaluation of W5 is estimated at $8.5 million, excluding overhead and owners’ costs.
The JV partners believe Walyering presents a low capex and ‘fast-to-market’ opportunity to develop and monetise the asset based on its gas specification being better than pipeline, measured gas samples returning next to zero impurities, reservoir pressure measured at five times the operating pressure of the Parmelia Gas Pipeline (PGP), and sharing a location with a PGP compressor station — linking the field to WA’s industrial gas market.
Talon Energy Executive Director and CEO David Casey commented on the results.
“Talon is extremely happy with the results to date and is very supportive of progressing Walyering to production as soon as possible. Strike has done a great job getting the JV to this point and we are excited to start marketing gas with Strike to meet WA’s industrial gas market where conditions have been tightening of recent.”
Strike Energy Managing Director and CEO Stuart Nicholls was also pleased with the results and will incorporate them in upcoming plans.
“The company is currently incorporating the results of Walyering into its development plans and, post a successful flow test in early 2022, will engage with an independent certifier to book reserves and resources at Walyering.
Strike is now investigating a concept design of a production system that could support up to 20 terajoules per day supplied by two wells at the Walyering gas field. Strike has already begun looking for the location and design of the Walyering-6 well. It also plans to investigate the opportunity to target early gas production at Walyering.
Strike’s shares ended Tuesday’s session 3.13 per cent in the red to close at 15.5 cents while Talon ended the day 5.88 per cent down with shares closing at 0.8 cents.