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State Gas completes drilling of Nyanda-4 well, confirms significant CSG project

The company will also increase its 80% interest in the project to 100%.
State Gas completes drilling of Nyanda-4 well, confirms significant CSG project
The gas project is about 50 kilometres from the Queensland Gas Pipeline

State Gas Ltd (ASX:GAS) has completed drilling of the Nyanda-4 coal seam gas (CSG) and conventional gas well at prospecting licence (PL) 231 in Central Queensland.

The work included coring, logging and testing and due to favourable results during the drilling the total depth (TD) was extended by 200 metres to 1,200 metres TD.

Although designed to be plugged and abandoned, the well has been suspended for future re-entry and testing.

The company has also initiated the process to increase its participating interest in the Reid’s Dome Gas Project, which comprises PL 231, from 80% to 100%.

The increase in ownership is being completed through the provisions of the joint operating agreement (JOA) which facilitate the acquisition of a participant’s interest where it has reduced to a less-than-minimum interest as defined in the JOA.

‘Free gas’ presence within Reid’s dome

State Gas chairman Tony Bellas said the outcomes of the Nyanda-4 well had far exceeded the company’s expectations and confirmed a significant CSG project and a “free gas” presence within the Reid’s dome structure.

Bellas said: “While we await further analytical results, the initial findings from Nyanda-4 indicate that this is a great outcome for the shareholders of State Gas, the state of Queensland and the Australian east coast gas market.”

Gas content increases with depth

Gas data obtained shows gas from around 392 metres and an overall increase in gas content with depth, indicating that the well was still in gas shows at TD.

Total gas peaks in mud logs of up to 3% above background of 0.2% directly correlate with the coals and sandstones present within the area.

From 636 metres the mud logs recorded heavier components of up-to C4.

The density log shows the presence of coal from 392 to 1,177 metres with seams up to 4 metres thick, with the majority of the coal seams between 392 and 880 metres.

Initial petrophysics analysis indicates 38 metres of net coal and 25 metres of carbonaceous shales and thinner coal seams (less than 30 centimetres), amounting to more than 60 metres of coals and shales intersected.

Well correlations indicate the lateral persistence of the Reid’s dome coal-bearing intervals across the entire PL 231 permit area.

Sole operator

State Gas is a Queensland-based developer and sole operator of the Reid’s Dome Gas Project which covers an area of 181 square kilometres.

The project area is known to host both coal seam gas and conventional gas reservoirs.

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