Hi all, to round off the weekend, I thought this article a good one, it basically touches on many of the exciting developments going on around Australia related to shale. Not specific to just BPT, but I think a great little read, if as always a little scant on detail. BTW, the link is better viewing, nice shiny bold/text to break up the article. Lastly, has anyone had a good look at what BPT holds in NT? I have not been able to find much as yet.
Australian shale and tight gas hits milestone as Norwest Energy, Exoma Energy increase activity Friday, August 17, 2012 by Bevis Yeo
Activity in Australia’s shale and tight gas sector has being picking up with greater exploration and increased activity by international majors, but Santos’ (ASX: STO) declaration that it is connecting Australia’s first commercial shale gas well marks a critical milestone.
While other companies have established flow rates from their unconventional gas wells, with Beach Energy (ASX: BPT) flowing 2 million cubic feet of gas per day from both its Holdfast-1 and Encounter-1 wells, none have yet established concrete plans to put the wells into production.
In contrast, Santos has already started work to connect its Moomba-191 shale gas well into existing gas gathering infrastructure that is located within 350 metres with first production to shales expected in October 2012.
Moomba-191 is a dedicated shale well that flowed gas at stabilised rates of 2.6 million cubic feet per day (MMcfd) with a peak rate of 3MMcfd from the Roseneath, Epilson and Murteree shales.
While Santos has flagged that shale gas could cost up to 30% more to produce compared to coal, it holds the largest acreage in the Cooper Basin, which could hold recoverable unconventional gas resources of 85 trillion cubic feet (Tcf) of gas according to U.S. Energy Information Administration estimates.
Coupled with its majority stake in the Moomba gas plant and the extensive infrastructure available in the Cooper Basin, Santos has the ability to kick start the critical mass required to duplicate the success shale oil and gas has enjoyed in North America.
Indeed, results from Moomba-191 will be used to plan its first horizontal shale gas well that is scheduled to be drilled early next year as well as its ongoing vertical well appraisal program.
Perth Basin
While much of the activity is occurring in the Cooper Basin with companies such as Senex Energy (ASX: SXY), Drillsearch (ASX: DLS) with QGC, and Orca Energy (ASX: OGY) drilling unconventional wells, considerable attention is also focused on the Perth Basin where fracture stimulation and testing efforts have yielded encouraging early results.
Norwest Energy (ASX: NWE) has enjoyed early gas flow rates of up to 777,000 cubic feet of gas per day from testing of the High Cliff Sandstone, a secondary target at its Arrowsmith-2 well, and has also started flowing gas from the primary target Irwin River Coal Measures, following successful separate fracs of the intervals.
This will be followed by fraccing of the other primary target, the Lower Carynginia and Middle Carynginia shales, as well as the secondary objective Kockatea Shale.
AWE Limited (ASX: AWE), which is sharing the fracture stimulation equipment with Norwest, has also flowed gas from the Middle Carynginia and Upper Carynginia shales at its Woodada Deep-1 well though flow results are not available as yet.
Meanwhile, Empire Oil & Gas (ASX: EGO) has flagged that it may explore the 24Tcf of in place unconventional gas that RPS Energy Services believes could be contained within the Lower Cattamarra Coal Measures in EP 389.
Southern Georgina Basin
Over in the Northern Territory, unconventional gas exploration activity in the Southern Georgina Basin looks set to pick up considerably with the entry of Norwegian state oil major Statoil.
With potential spending of up to US$210 million under its farm-in agreement with Canada’s PetroFrontier (CVE: PFC), the deal is also larger than previous foreign investments into Australian shale and tight oil plays.
Statoil has flagged that it could drill between 10 and 20 wells by 2017, giving Baraka Energy & Resources (ASX: BKP), which while not a direct participant in the farm-in, exposure to its upside through its undiluted 25% stakes in EP 127 and EP 128, both of which are covered by the agreement.
Fraccing of the MacIntyre-2H in EP 127 as well as PetroFrontier’s 100% owned Baldwin-2Hst1 and Owen-3H is expected to begin soon, giving the partners more information about how the target Arthur Creek Formation shales compares to North America’s highly productive Bakken Shale.
Canning Basin
Unconventional gas exploration in the Canning Basin has also picked up with Buru Energy (ASX: BRU) finding signs that its Yulleroo gas accumulation is part of a basin centred gas accumulation that offers better gas recoverability and lower costs than traditional unconventional gas plays.
New Standard Energy (ASX: NSE) is poised to drill the first of an initial three well program with ConocoPhillips to establish the hydrocarbon prospectivity of the Goldwyer Shale.
The Goldwyer Shale is believed to have attractive economic parameters that are similar to the North American Bakken and the Eagle Ford shales.
Key Petroleum (ASX: KEY) will also start exploration activity under its Canning Basin focus with its participation in the upcoming Cyrene-1 exploration well.
Operator Buru Energy will spud the well, which targets conventional Willara Formation shallow oil play that could hold 5 million barrels of recoverable oil and the unconventional Goldwyer Shale, after it completes the Ungani North-1 well.
A core will be cut from the Goldwyer to assess its unconventional oil potential.
Galilee Basin
In Queensland, Exoma Energy (ASX: EXE) and Chinese major CNOOC are involved in an aggressive 22 well drilling program to appraise the coal seam gas, conventional oil and shale oil and gas resources in their acreage, which covers 27,000 square kilometres.
These include seven shale exploration wells to collect further shale geological and geochemical data on the Toolebuc shale, which covers about 20,000 square kilometres.
Early exploration had indicated the Toolebuc shale could hold more than 3 million barrels of oil equivalent of in place oil and gas per square kilometre.
BPT Price at posting:
$1.26 Sentiment: LT Buy Disclosure: Held
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