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West Erregulla takes steps towards investment decision

Warrego Energy

West Erregulla joint venture partners Strike Energy and Warrego Energy are on track with their plan for the appraisal phase of the Perth Basin prospect in Western Australia.

During the September quarter, Strike achieved spud of the West Erregulla-3 (WE3) well, marking the beginning of the appraisal phase.

The JV expects to be in a good position to consider a final investment decision for West Erregulla by the first quarter of the 2021 calendar year.

It will make the decision after it has received results from the appraisal program, with first gas sales from West Erregulla targeted in mid 2022.

In a quarterly update released today, Strike reported that the WE3 well was in the first intermediate hole section post drilling, casing and cementing the surface hole section.

The company added that, at the time of writing, the rig was ahead at a depth of 1692m.

Three appraisal wells will be drilled down to 5000m during the program, with WE3 designed to test the continuation of the commercial gas accumulation in the northern fault block.

Strike managing director and chief executive Stuart Nicholls said the company completed further de-risking and made significant commercial and technical progress on the West Erregulla development during the quarter.

“We have started a 12-month drilling campaign that will set up West Erregulla for future production, as well as appraising and exploring our highly prospective acreage at Walyering and South Erregulla that has the potential to multiply the company’s gas resources,” Nicholls said.

“On the commercial front, we have generated alignment in our West Erregulla joint venture, which will bring more gas online as part of phase one.”

The agreement between the partners involves delivering 80 TJ of gas a day into the Dampier to Bunbury natural gas pipeline.

Australian Gas Infrastructure Group (AGIG) remains the preferred proponent to build, own and operate the phase one facility and is completing a supplementary front-end engineering and design (FEED) study for the larger capacity plant by the end of this year.