Norwest Energy has given a joint venture resolution to drill the EP368 exploration well at Lockyer Deep prospect in Western Australia with Energy Resources the green light.
The well is 15km east of the Waitsia gas field and directly on trend with the recent West Erregulla-2 gas discovery which, as recently reported by Strike Energy, has 2C contingent resources of 1.19 Tcf gas.
The Lockyer Deep-1 location offers the highest geological chance of success for testing of the Permian Kingia/High Cliff conventional gas play within the combined Lockyer-North Erregular Deep greater structure, for which Norwest Energy estimates prospective resources of up to 1.12 Tcf gas.
Norwest managing director Iain Smith said the company would participate in a well that had the potential to be truly transformational for the company in 2020.
“Recent exploration success within the Kingia/High Cliff play has resulted in a quantum shift in the way the industry views the basin and we are fortunate to be perfectly placed within the play’s sweet spot,” he said.
“With a 100 per cent success rate for the three wells that have targeted this play in recent times, we hope to build on that success to make it four from four.”
Norwest’s current estimate of GCoS is 29 per cent, however. Beach Energy’s recent Beharra Springs Deep discovery is thought to further mitigate the geological risk at Lockyer-North Erregula Deep due to the analogous structural setting.
The company is presently re-evaluating the GCoS for the Lockyer Deep location and will announce its revised estimate during December 2019.
Norwest has completed a placement to sophisticated and institutional investors raising $3.3 million and has opened a share purchase plan (SPP) to existing shareholders on the same terms as the placement.
The company is fully funded to participate in the Lockyer Deep-1 exploration well at the its 20 per cent working interest. The SPP offer closes on Friday.
Operator Energy Resources has secured land access to the well location for preparation and construction of the Lockyer Deep-1 well pad, through a drilling land access for personal use only.
The prognosed depth for the Top Kingia target is approximately 3900 metres TVDSS, and Energy Resources is in discussions with various third parties in order to secure a suitable drilling rig to drill during the first half of 2020.
Further to the recent resurgence of activity within the basin, Norwest Energy anticipates that a number of appraisal/development and exploration wells will be drilled by various third parties throughout 2020, and that a suitable drilling rig will be available for contracting to the EP368 joint venture.