Armour Energy: Egilabria 2 Gas Well Making Good Progress, Australia

July 29, 2013

Armour Energy announced good progress in the Egilabria 2 lateral well. The well is being drilled to test the reservoir characteristics and ascertain likely gas flow rates in a commercial development scenario for Armour Energy’s gas resources in the Lawn Shale unit of the Isa Superbasin, ATP 1087, north of the regional mining and infrastructure centre of Mt Isa in north Queensland.

Armour Energy holds 100% of the project which contains a prognosed recoverable resource of 22 Trillion Cubic Feet (TCF) of gas.

The company is investigating the potential delivery of 330 Petajoules (PJs) of gas per annum to domestic and export LNG markets through a gas delivery system in conjunction with the APA Group.

Armour Energy recently intersected a 135 metre section of the prospective Proterozoic aged Lawn Shale unit encountering numerous, significant gas shows and flares, corroborating gas shows of up to 8% while drilling with mud by Comalco in 1991, who were exploring for oil.

In the last week of operations Armour Energy has successfully commenced the Egilabria 2 side track lateral well (DW1) on a trajectory based on an intense analysis of detailed logs sourced from the vertical hole which bottomed below the Lawn Shale.

As previously reported, the vertical well encountered strong gas shows above, within and below the shale. Logs have shown the shale to be gas charged, thicker than expected, and suitably fractured for stimulation activities.

Armour Energy is currently drilling some 450 metres of lateral hole into the gas rich Lawn Shale with higher than expected penetration rates both above and within the Lawn shale.

During operations running back into the hole with the new bit, the company encountered strong gas shows producing flares which burned in excess of 5 minutes and up to 3 metres long .

Gas analyses show predominantly methane with negligible carbon dioxide levels. Some helium (a valuable by ‐ product) has also been detected.

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LNG World News Staff, July 29, 2013; Image: Armour