Kinetiko Energy Ltd (ASX:KKO) is trading higher after delivering a record-breaking peak of 13 cubic metres per tonne from gas desorption testing at Majuba core well 271-23C near the Majuba Power Station in South Africa.
Meanwhile, core well 270-03C has been spudded and is the second to be drilled in the southern exploration right 270 as part of a three-well initial program in this block.
This new core well is about 10 kilometres north of the recently completed successful core well 270-06C and around two kilometres from South Africa’s largest gas pipeline, the Lily Pipeline, which feeds the industries of the KwaZulu-Natal midlands and coastal cities.
The market has welcomed the positive results from energy-hungry South Africa with shares trading as high as A$0.11, up 25% on the previous close.
Moving forward, drilling continues to aggressively focus on identifying further gas-laden sandstones, coals and other carbonaceous structures and extend the continuity of potential gas fields.
"Huge success"
Kinetiko CEO Nick de Blocq said: “The huge success we achieved in core hole 271-23C near the Majuba power station is very encouraging as we look at the potential of supplying substantial gas volumes to co-fire the coal plant.
"The 270-03C borehole represents the second of three initial cores we have planned in this area and is part of the pilot programs covering two new entry blocks, namely ER270 and ER272.
“The proximate location of our southernmost boreholes in ER270 to the steel and manufacturing centre of Newcastle could mean a smelting simplified logistical solution to get the gas to an increasingly hungry In our northernmost block, thermal industry market.
"In our northernmost block, ER272 we are already working with Sasol on borehole placements ahead of the rig’s arrival around Easter.”
Forward plan
Kinetiko expects to core the entire stratigraphical profile from the top of the dolerites to an approximate terminal depth of beyond 500 metres.
On completion of the drilling, the company will log the corehole and perform onsite gas emission and desorption analysis.