I don't like to see people losing money, so I have decided to write a short summary giving reasons why I have sold out.
Shell are drilling and testing horizontal wells in shallower sands which have superior rock properties compared to the Canyon sands in my opinion (please refer to the paper by Gareth Cooper, Greg Channon, Pete Bekkers and Neil Young, May 2023 "The Permian gas potential of the Taroom Trough, Queensland: new ideas to unlock a multi-Tcf play, which I think also exists as scanned pages on our Research thread).
The Canyon sand is around 4600m depth and it is likely to be more compacted than the shallower Dunk sands to the north west. The permeability contour map has around 0.1 mD in the proximity of the Canyon - 1H well.
We have been told that the Dunk sands have variable permeability ranging up to 0.17 mD, and so on that basis we might conclude the sands have similar productivity assuming similar bed thickness, similar horizontal well length and number of fracs as the recent Shell wells.
However, the permeability maps in the paper indicate that the Kianga at shallower depths in the north west are around 0.7 - 0.8 mD. Consequently, there is doubt in my mind regarding the reliability of <0.17 mD in the Dunk sands because there might be much higher perm than that. If the recent Shell well test unofficial flow rates are to be believed then I would be tempted to say the most we can expect from the Canyon 1H well will be in the range 0.3 - 1.3 mmscfd. I have also taken into consideration the fact that half of the 822m horizontal section has low gas saturation.
In my opinion it is too much of a gamble hoping for 2 - 3 mmscfd. As always Dyor.
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