Elixir Energy Ltd (ASX:EXR, OTC:ELXPF) has completed a key diagnostic test at its Lorelle-3H appraisal well in Queensland’s Taroom Trough, with results supporting the company’s plan to move into stimulation operations later this week.
The company highlighted the Diagnostic Fracture Injection Test (DFIT) at the toe end of Lorelle-3H indicated preliminary reservoir pressure of about 6,350 pounds per square inch (psi), in line with expectations and consistent with regional data.
Consequently, the result indicates an overpressured gas gradient of about 0.6 psi per foot.
Elixir is mobilising and rigging up stimulation and well testing equipment, with stimulation operations commencing.to schedule towards the end of this week.
Fracture containment result “better than expected”
The DFIT also measured closure pressure in the Tinowon ‘Dunk’ Sandstone at 8,759 psi.
Closure pressure represents the minimum in-situ horizontal stress, or the minimum pressure needed to hold open an induced hydraulic fracture.
Elixir said the result was better than expected and indicated the planned fractures could be maintained within the target Tinowon ‘Dunk’ Sandstone formation, rather than connecting into overlying or underlying stratigraphy.
The company said this would help concentrate fracture energy into the target reservoir and maximise the effectiveness of the planned stimulation.
Stimulation stages increased to 12
Following the DFIT results, Elixir has increased the official number of planned stimulation stages at Lorelle-3H to 12.
The company had originally planned an 11-stage stimulation using 6 million pounds of proppant, but said the quality of the toe stage and low incremental cost justified adding another stage.
Elixir said the extra stage was expected to increase the modelled productivity of the well during testing.
The company has begun mobilising and rigging up stimulation and well-testing equipment, with stimulation operations expected to start on schedule toward the end of this week.
Lorelle-3H targets commercial gas and condensate flow
Lorelle-3H forms part of the Lorelle-3 appraisal well in ATP2056, where Elixir holds a 50% interest and is operator of the appraisal well. Santos holds the remaining 50% and will operate the permit thereafter.
The well was drilled in 2 phases. The pilot hole reached a total vertical depth of 3,580 metres and collected core and logs across Permian sandstone reservoirs in the Taroom Trough, within the Bowen Basin.
Elixir said earlier petrophysical results exceeded expectations and demonstrated multiple thick gas and gas-condensate-bearing reservoirs, with 148 metres of measured net gas-condensate pay.
The second phase included a 1,157-metre horizontal sidetrack into the Tinowon ‘Dunk’ Sandstone, the primary target, at a measured depth of 3,332 metres below rotary table.
The horizontal well has been cased and suspended for stimulation and production testing.
Taroom Trough appraisal focus
Elixir said the Tinowon ‘Dunk’ Sandstone horizontal well and flow test were designed to demonstrate commercial flow rates of gas and condensate from the Basin Centred Gas Play.
A successful result could support a possible maiden reserve conversion from the company’s underlying resource base.
The company describes Lorelle-3H as the first horizontal well drilled and tested outside Shell’s acreage on the upper western flank of the Taroom Trough.
Largest acreage holder
Elixir is the largest acreage holder in the Taroom Trough and is aiming to appraise about 3.5 trillion cubic feet of independently certified 2C contingent gas resources.
The project is close to the Wallumbilla Gas Hub, multiple gas pipelines, LNG export infrastructure and Queensland’s established onshore gas industry.
The Taroom Trough is a multi-TCF basin-centred gas play. It is highly advantaged by its immediate proximity to the Gas multiple gas pipelines, the nearby 25 mtpa of LNG export. infrastructure, multiple operating refineries and sitting amongst the mature and well-serviced onshore gas industry of Queensland.