The Frac gear is being delivered and assembled at Whicher. Brief mention in today AFR as below. The dreaded 'tight gas' the villian of course - the cause of much heartbreak and financial pain for Amity and its share/option holders in recent times.
Its make or break time at Whicher...
High-pressure bid to unlock gas field Jul 07 Ian Howarth
The natural gas market along Australia's south and east coast could be substantially reshaped if junior oil and gas explorer Lakes Oil can produce a big gas flow from its onshore Wombat gas discovery near Sale in Victoria's east.
Earlier this year, the Wombat 2 wildcat well discovered a potentially large gas field, but the tightly packed nature of the reservoir structure allowed only a small, non-commercial gas flow.
Now Lakes Oil hopes to increase the gas flow by pumping about 80,000 litres of gelled diesel fuel and four shipping-container loads of ceramic beads into the well.
By pumping the gelled fuel and bead mix through perforations in the steel casing of the well at a pressure of 8000 kilopascals, Lakes Oil and its US-based technical adviser, Halliburton, hope to fracture the tight gas-bearing formation and release commercial quantities of natural gas.
The Lakes Oil project mirrors another "tight" gas reservoir stimulation project at the Whicher Range field near Busselton, south of Perth, where project owner Amity Oil plans to use identical technology in a bid to commercialise the massive gas resource in the ground.
Gas has already flowed from both projects, but at rates too small to sustain commercial production.
Relying on advice from US drilling and geotechnical specialists Halliburton and Schlumberger, Lakes Oil executive chairman Rob Annells believes the tight formation in the adjacent Wombat and Trifon fields can yield a commercial gas flow.
High-quality oil and gas reservoirs consist of coarse, sandy layers trapped beneath a sealing formation such as shale or clay.
In a tight reservoir, the sand particles are much smaller and typically contain clay, which swells when it comes into contact with water, blocking the pores between the sand grains and stopping the oil or gas flowing into a well.
Lakes Oil's Wombat and Trifon wells lie about 30 kilometres south of Sale, close to the main gas transmission pipeline linking Esso/BHP Billiton's Longford gas plant to the Melbourne metropolitan market.
Annells says the fields form part of a substantial potential onshore gas reserve that is limited by the "tight" nature of the underground formation, similar to Amity's Whicher Range project. The drilling rig to conduct the well fracturing is due on site this week.
Former BHP Petroleum senior executive Howard McLaughlin, now managing director of Amity Oil, says: "The traditional view is that Whicher Range holds 3 to 4trillion cubic feet of gas and it really comes down to how much of that can be commercially extracted."
Whicher Range and the Wombat/Trifon project are virtually identical because of the tight nature of the formation that contains the gas and the tendency of traditional water-based drilling mud, used to lubricate the drill bit, to damage the well, blocking a proper gas flow.
Water damage is believed to have been the main reason for the lack of commercial flows at both projects.
"This time we'll use diesel fuel [as a drilling fluid] to avoid reservoir damage altogether," McLaughlin says.
The diesel gel technique is well proven in the United States, where tight gas fields now produce a substantial part of that country's total gas demand. McLaughlin says, "We're basing our fraccing [fracturing] operations on techniques successfully used on tight gas fields in the US, particularly in Wyoming. The fractures are horizontal as well as vertical and so we'll access about 75per cent of the well, or around 10times more than previous fraccing techniques".
If the program is successful, Whicher Range gas will be sold to the gas-hungry southern West Australian market, providing a welcome alternative source of supply.
Lakes Oil may have gas reserves that also measure in the trillions of cubic feet range at its onshore Gippsland Basin operations, but reserve calculations cannot be completed until the outcome of the Wombat and Trifon projects is known. But Annells says: "The area we are targeting is extremely close to infrastructure, with existing pipelines traversing the Trifon structure and passing within one kilometre of the Wombat structure.
"These pipelines could give Lakes Oil access to markets in Melbourne, Adelaide, Sydney, Brisbane and Tasmania.
"We believe it would be difficult to find a better location.
"The added advantage is that if the project is successful, capital costs of development will be significantly lower than similar developments offshore."
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