Elixir (ASX:EXR) on rails to wake Daydream-2
November 2, 2023The rig has been formally released, is mobilising to the Grandis Gas Project, and Elixir Energy is officially on rails for a spudding of the Daydream-2 gas well early next week in the Bowen Basin of southeast Queensland.
Grandis holds an initial contingent resource of 365 billion standard cubic feet of gas and given previous estimates of prospective resources were only based on gas in place estimates within the coal fracture system, a deep coal flow from Daydream-2 is likely to provide a large material increase.
And Elixir will be joined by Shell, providing further encouragement that it is in the right spot for gas with the multinational now drilling in a tenement immediately to the west.
“With the formal release of SLR 185 to Elixir the spud of Daydream-2 is now only a few days away. Two large rigs will then be drilling contemporaneously to further open up the Taroom Trough – a real sign of its potential importance for domestic and international markets,” Elixir Managing Director Neil Young said.
The Taroom Trough area has been the focus of Australia’s coal seam gas and LNG export industry since 2014 and had its early hydrocarbon potential realised through conventional discoveries.
The source rocks are known to produce massive quantities of oil and gas, but with only a small portion trapped in conventional structures, it implied a hefty volume could be trapped in tight reservoirs, and Elixir saw an opportunity lying untouched.
And a deep discovery of gas using new understandings would come at an ideal time for an Australian domestic gas market which continues to worry over winter shortfalls.
Wesfarmers have even claimed some producers could be deliberately delaying the development of new fields to secure higher future pricing, but Elixir looks to now be firing up to claim its own and backed by the Federal Government, who will pay for 43.5 per cent of the total costs of Daydream-2.
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