Oil and Gas News

Armour, Stonehorse jointly fund Myall Creek 2 well

Armour_Kincora_Myall_Creek-1 (2)

Armour Energy will partner with Stonehorse Energy and a private entity to fund the work-over and stimulation work program for the Myall Creek 2 well, in south west Queensland.

Armour will initially perforate and fracture stimulate the Myall Creek 2 Lower Tinowon formation, commencing December 2021, and subsequently fracture stimulate up to two further formations, with exact timing dependent on results of the perforation.

Myall Creek 2 Lower Tinowon is an over-pressured, stratigraphic controlled, laterally continuous reservoir found throughout the Myall Creek and Riverside fields.

Armour and its funding partners are confident that the Lower Tinowon will respond similarly well to perforation and fracture stimulation.

The two entities will jointly fund 100 per cent of the capital cost in return for a share of production.

The entities will receive 50 per cent of the revenue produced from the well less costs for a period of six years, while Armour will retain the remaining income.

The Myall Creek 2 well is situated structurally high on an apparent, 3D interpreted, four-way dip closure, with the lower Tinowon at virgin pressure.

Production from the Myall Creek 2 well will commence flowing additional gas into the Kincora Gas Gathering System for processing and sale via the Kincora Gas Processing Plant.

It is anticipated that initial perforation of Myall Creek 2 will take approximately 8 days from rig mobilisation to the well coming online.

The Myall Creek 2 investment will be Stonehorse Energy’s’ first oil & gas investment in Australia.

The private entity is a group of private investors unrelated to the company, including parties with deep experience in fracture stimulation.

Armour’s chief executive officer Brad Lingo said the company was excited to see further investment in the Myall Creek field, which offers strong potential from untapped formations.

“Armour will continue to pursue partnering to fund value-adding work programs and to enhance production,” said Lingo.

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