The highly anticipated drilling on Innamincka Petroleum (ASX: INP) Coal Seam Gas targets is moving closer.
A rig has been confirmed for exploration drilling within PEL 103 in the Cooper Basin to commence in August. AGL Energy Limited (Operator) will pay for the three planned core holes as part of its $5 million carry of INP’s share of future exploration and appraisal activity.
What renders excitement is that coal intersections were recorded in the majority of the surrounding wells on the Innamincka Dome at depths of 200-540 metres with cumulative interpreted coal thicknesses of up to 40 metres in a single well.
These depths and coal intersections are similar to a number of commercial Surat Basin CSG fields.
Independent consultants Resource Investment Strategy Consultants has calculated that the Innamincka Dome contains an estimated potential high side recoverable CSG resource of up to 800 Billion standard cubic feet (“Bscf”).
Strategically for for INP shareholders, this area is located only 25 kilometres from the QSN Link (Ballera-Moomba) transmission pipeline, enhancing cost-effective access to the gas market.
If successful, a pilot test to demonstrate the ability to commercially produce gas. This will be followed by development plans and economics to support commercial development.
The relatively close proximity of the transmission pipeline infrastructure would improve project economics and differentiate Innamincka Dome CSG from other potential projects as gas could be brought to market quickly.
INP has signed gas marketing agreements with AGL earlier this year which allow INP to obtain market prices for its share of any gas produced.
Locations have been selected and approvals are anticipated so that drilling will commence on time.
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