The board of Metgasco Ltd (ASX:MEL) has revealed a huge material upgrade to the independently evaluated reserves for the Vali Field in the Cooper Basin.
The Vali field has seen a three-fold increase in its Gross 2P Gas reserves from it’s original independent evaluation.
The Gas reserves for the Vali field have increased from 30 Bscf (billions standard cubic feet) up to 92 bscf.
The huge increase improves the economics of the project, along with the expected life of the gas field (up to 30-40 years from 20 years).
The company is now looking towards its final investment decision on the Vali gas field with its joint venture partners.
Before it can do so, Metgasco needs to tick off three key catalysts:
Agreeing a process tariff with Santos for the use of their Moomba production facility
Completed detailed engineering work on the company’s Vali pipeline and route as well as investigate commercial funding options
Securing a gas sales agreement with potential for gas pre-payments
Metgasco expects these catalysts expected to be overcome within this CYQ4, and expects gas production from the hub to begin in mid CY2022.
Metgasco Managing Director Ken Aitken said “The independent evaluation of a material upgrade in the Vali gas field reserves is a great outcome for Metgasco and confirms the decision to drill the Vali-2 and 3 appraisal wells. The study confirms the Toolachee reservoir has conventional gas flow potential to supplement the unconventional potential gas productivity in the Patchawarra zone already tested in Vali-1 ST1. This reserves upgrade further validates Metgasco’s “string of pearls” thesis and underpins the planned pivot to a gas producer into the strengthening East coast gas market in mid CY2022.”
MEL Price at posting:
3.2¢ Sentiment: None Disclosure: Not Held
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