Empire chases NT gas amidst east coast shortfall

Amidst an alarming shortfall in domestic gas supplies, ASX-listed Empire Energy Group is powering ahead with its Beetaloo Sub-basin appraisal program in the Northern Territory – a campaign it says is the most active in the history of the revered zone.

As part of the workstream, the company is looking to initiate commercial production through a trio of gas wells in the zone, Carpentaria-2H, Carpentaria-3H and Carpentaria-4V.

Empire says it has dispatched a production logging tool or “PLT” to Carpentaria-2H to provide its technical staff with a detailed set of production data. PLTs are commonly used to evaluate fluid rates in both production and injection wells and typically enable a better understanding of a bore’s productivity in its areas of interest.

The company says the data will allow it to craft a bespoke fracture simulation strategy, fluid mix and pump schedule for future wells completed in the Beetaloo. Empire claims the activity could generate more gas production and ultimately drive up efficiencies in the gas-rich terrain.

Sydney-based Empire has already used data to drive efficiencies in the Beetaloo with the drilling, casing and cement work associated with its Carpentaria-3H well estimated to total about $11 million. The sum is a $100,000 improvement over Carpentaria-2H.

So far the company has completed much of the work required to hydraulically stimulate, or “frack” Carpentaria-3H and Empire is now ready to launch the program.

The proposed fracking campaign will be comprised of 40 reservoir intervals or “stages” across 2000m of the well’s 2632m horizontal section. Management believes the program is not only the largest in the Beetaloo Sub-basin to date but in the history of Australia’s onshore oil & gas sector.

Empire is hopeful it can round out its pre-Christmas work slate with the drilling of the nearby Carpentaria-4V well which has been delayed due to recent rainfall. The company says the well is designed to determine whether the gas-bearing Velkerri-B shales in the Western part of its EP187 tenement extend into the zone.

If validated Empire argues it could table a significant increase in its independently assessed discovered or “contingent” resources. The assumption follows a recent study by the NT government that indicates the Velkerri-B layer could contain 500 trillion cubic feet of gas.

In August the company noted its assets in the area held a contingent resource of 554 billion cubic feet of gas and 3.5 million barrels of liquids.

The work follows a recent report by the Australian Competition and Consumer Commission, or “ACCC” suggesting without intervention Australia’s east coast will endure a gas shortage next year. The regulator is now concerned the already high price of the commodity could jump even higher.

The ACCC’s report stated east coast markets faced a 56 petajoule gas shortfall in 2023 with exporters sending the bulk of their inventory to overseas buyers.

Empire claims the only way to temper price hikes sustainably is to increase supply to the east coast and says its gas operations in the Beetaloo could play a key role in resolving the issue.

Is your ASX-listed company doing something interesting? Contact: matt.birney@businessnews.com.au