Metgasco: Immediate Gas Production from Thornbill E01 (Australia)

Metgasco is pleased to advise that the drilling of Thornbill E01 has resulted in immediate gas production to surface and no water production.

• Average gas flow rate over a 6 hour production test: 100 mcf/d

• No water production during the test

• No CO2 detected during the test

Thornbill E01 (PEL 426) is a vertical well drilled to 846 metres to explore and test the Walloon Coal Measures (WCM) in the area of the Banyabba surface anticline approximately 50km south of Casino. The well was designed as a simple, low cost vertical test to evaluate the potential gas productivity of the WCM in this area.

A 6 hour production test was conducted which resulted in stabilised gas flows and an average flow rate over the test period of 100 mcf/d with no associated water production. No CO2 was detected using the onsite equipment during the flow test.

This well provides further evidence of the presence of a “dry” coal seam gas play in the Clarence Moreton basin which flows little or no water at the time of drilling. Thornbill E01 follows up similar results achieved from the Orara E01 well drilled by Metgasco, which was drilled 35 km to the southwest of Thornbill E01 in January 2009 and the Wyan E01 well which was drilled by Metgasco in May 2009, 45 km to the northwest of Thornbill E01.

The Wyan E01 well produced gas on test at 175 mcf/d. Such “dry” coal seam gas plays are rare, with the best known example being the Horseshoe Canyon Coals (HSC) in Alberta Canada. The HSC is Canada’s largest coal seam gas development.

Initial average production rates from HSC wells are 53 – 92 mcf/d. The majority of coal seam gas developments in North America and Australia have been from coals containing water and gas, where the wells must be dewatered prior to gas production.

Horseshoe Canyon wells have proven to be highly profitable because production is immediate and there are no associated water handling costs. David Johnson, Metgasco’s Managing Director said “We first saw gas production without water production at the Orara E01 and Wyan E01 wells.

This was a suprise as “dry” coal seam gas plays are rare. Since then, Metgasco’s exploration team has compared the technical characteristics of the Clarence Moreton and the Horseshoe Canyon coals and found that they have some similarities. The Thornbill E01 well was designed to test this thesis and it is very exciting that the well has delivered immediate sustained gas production.” Thornbill E01 will be followed up by the drilling of Thornbill E02 once ground conditions are suitable to move the rig on site.

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Source: Metgasco, October 27, 2010