Encounter-1 has to date provided us with enormous encouragement as to the potential of the shale gas exploration play in the Nappamerri Trough. The much larger thickness than anticipated of the Roseneath Shale that was announced last week provides both the potential for considerably larger gas in place numbers and greater ease of stimulating the production of this gas. The very high mud weights required for the safe and controllable drilling of the well (13.6 ppg rather than 9.0 ppg) together with the constantly high gas shows encountered both prior to and within the primary targets point to large overpressure and/or a high concentration of in situ gas. Either or both scenarios indicate a significant amount of gas in the system.
ADE Price at posting:
8.4¢ Sentiment: Buy Disclosure: Held
