Elixir Energy Ltd (ASX:EXR, OTC:ELXPF)’s joint venture partner Xstate Resources Limited (ASX:XST) has confirmed the completion of civil works for the Diona-1 conventional gas well.
EXR maintains a 49% interest in Queensland’s Surat-Bowen Basin Diona Block. Under the farmout arrangement, Xstate is the operator and will fund the drilling program, while Elixir retains exposure to the project’s potential upside.
The Diona Block is one of three within ATP 2077, with Elixir holding 100% beneficial ownership of the other two blocks. The company views its position as a strategic foothold in a basin with proven gas infrastructure, providing an opportunity to leverage exploration success without committing additional near-term capital.
Xstate completes well pad and targets spud later this month
Xstate has confirmed the completion of civil works for Diona-1, including well pad construction, cellar and conductor pipe installation. The Ventia 101 rig is scheduled to mobilise around September 22, with spudding anticipated shortly thereafter.
Managing director Andrew Bald said the team was focused on a smooth transition into drilling.
“The Xstate team has been extremely busy in preparation for drilling. The cellar and conductor pipe were installed quickly and efficiently last Friday with everything now in place for us to begin drilling once the rig arrives next week,” Bald said.
The Diona Project is a shallow, conventional gas prospect with liquids potential, located between the Silver Springs gas processing facility and the Waggamba gas field in Queensland’s Surat-Bowen Basin.
The Diona-1 well will test the Showgrounds, Tinowon and Wallabella reservoirs, with drilling to a planned depth of 2,600 metres expected to take less than 15 days.
With the Waggamba pipeline less than 100 metres from the well pad and a tie-in point about 1 kilometre away, the project is positioned for an accelerated path to market if successful.