Tamboran Resources Corporation (NYSE:TBN, ASX:TBN) has its foot on the gas pedal with its primary focus on the Beetaloo Basin in Australia’s Northern Territory (NT), which is set to play a role in feeding demand for energy on the nation’s populous East Coast.
Drilling is nearing completion on the SS-2H ST1 sidetrack well at which Tamboran achieved record Beetaloo Basin drilling rates after implementing key learnings from the original SS-2H well.
This month the company expects to begin drilling the Shenandoah South 3H (SS-3H) well from the same pad as SS-2H ST1 and this is projected to include a 10,000-foot (~3,000-metre) horizontal section.
The SS-2H ST1 and SS-3H wells are planned to be stimulated with up to 60 stages using the recently imported Liberty Energy frac fleet, which was mobilised in the September quarter. This is expected to begin next quarter.
Quarterly progress
In the September quarter, TBN completed drilling Shenandoah South 2H (SS-2H) well in EP 98 to total depth (TD) of 20,669 feet (6,300 metres) in 35 days with the Helmerich & Payne (H&P) FlexRig® super-spec rig.
This was the first ~10,000-foot (3,000-metre) horizontal section drilled within the Mid Velkerri B Shale in the basin to date and was successfully geostreered within the shale without the need for a pilot hole.
Data from SS-2H well demonstrated geological rock properties consistent with the SS-1H location, with strong gas shows across the entire horizontal section and no observed faulting.
Sidetrack well
On completion, a downhole mechanical issue was not resolved, resulting in the well being plugged and sidetracked. As a result, the SS-2H ST1 sidetrack well has reached a depth of 16,201 feet (4,938 metres) at record rates and is expected to be completed by the end of November.
The H&P rig will then be skidded across the pad in preparation for the SS-3H well, which is planned to be completed with a 10,000-foot (~3,000-metre) horizontal section.
A busy period
Tamboran managing director and CEO Joel Riddle said: “The first quarter of FY25 was another busy period for Tamboran as we commenced our 2024 Beetaloo drilling operations.
"The SS-2H well spudded in late August 2024 following additional civil works required to stabilize the cellar at the well site. The well was successfully drilled to 20,669 feet (6,300 metres) total measured depth in 35 days, the second fastest drilling rate achieved in the Beetaloo Basin, behind the A3H well drilled by Tamboran in 2023.
“Despite delivering the longest horizontal well in the Beetaloo Basin to date, a downhole issue occurred upon the completion of drilling and before the installation of casing. Unfortunately, we were unable to remediate the issue, resulting in the well being sidetracked as the SS-2H ST1 well.
“The sidetrack was drilled from 1,837 feet (~560 metres) and is currently at a depth of 16,201 feet (4,938 metres) following successful implementation of key learnings from the drilling of the original SS-2H well.
“The SS-2H ST1 well has achieved the fastest drilling rates from the bottom of the Moroak Sandstone (~7,500 feet below surface) to date.”
Stimulation ahead
During the quarter, Liberty Energy’s frac fleet was mobilized to the basin ahead of the 120-stage stimulation campaign (60 stages each) for SS-2H ST1 and SS-3H.
This will be the Beetaloo Basin’s largest stimulation campaign to date and is projected to deliver an increase in the number of completions per day compared to historic completions. This is expected to deliver increased completion efficiency, which drives completion cost reduction.
“We look forward to completing the SS-2H ST1 well and progressing the drilling activity on the SS-3H well. Importantly, we remain on track to deliver IP30 flow rates during 1Q 2025, which is in line with guidance,” Riddle said.
Other interests
Progress was also made during the quarter at other TBN Beetaloo Basin interests.
At EP 161, where operator Santos has a 75% working interest and Tamboran a 25% working interest, the NT Government approved the operator’s Environmental Management Plan for the 158-mile (255-kilometre) 2D seismic survey over the Jibera South and Newcastle South areas.
The seismic acquisition is scheduled to be completed by the end of this year with processing expected to start next quarter.
Also, during the period at EP 136, EP 143 and EP(A) 197, 100% held by TBN, the NT Government approved Tamboran’s EP 136 permit renewal for Term 2. The renewal includes the drilling and stimulation of one horizontal well in the permit in 2H 2026.
NTLNG pre-FEED
At a commercial level, in August 2024 Tamboran awarded Bechtel the pre-FEED for its proposed NTLNG project at Middle Arm in Darwin following a competitive process with some of the world most experienced EPC contractors.
The decision to progress to pre-FEED activities follows a comprehensive six-month Concept Select study by Wood Group, which defined and selected the key LNG plant specifications including liquefaction technology, compressor driver configuration, LNG capacity and facility infrastructure layouts.
Pre-FEED activities are expected to further optimize the low-cost, high-reliability plant design and are expected to take about 32 weeks.
Sale of US rig
During the quarter, Tamboran received an offer to purchase the company’s drilling rig in the USA for US$8.5 million (pre-fees). The rig was originally acquired for import into Australia prior to Tamboran’s partnership with H&P.
By the end of the quarter, the company had received a US$400,000 deposit and the remaining amount was received in October.
“The higher costs associated with drilling the SS-2H sidetrack well (~US$5 million) has been more than offset by the cash received for selling our US drilling rig (~US$8.5 million, pre-costs) meaning we are funded to deliver flow results from the SS-2H ST1 and SS-3H wells,” Riddle added.
Near-term work
During the current quarter, Tamboran’s activities will be focused primarily on the Beetaloo Basin assets:
- Complete drilling of the SS-2H ST1 and SS-3H wells.
- Commence stimulation activities of the SS-2H ST1 and SS-3H wells.
- Sign binding transportation agreements with APA Group (ASX:APA) for the SPP.