Empire Energy Group has lit up with increased gas flow rates from its fracture-stimulated Velkerri shale gas horizontal well, known as “Carpentaria-3H”, in the Northern Territory’s Beetaloo Basin.
The company says it has reaffirmed its strategy to optimise gas production. The results replicate post-soaking improvements seen in its other horizontal well, Carpentaria-2H (C-3H), auguring well for the planned gas pilot project to service existing gas pipelines.
Empire says C-3H flowed gas at an average rate of 3.3 million standard cubic feet per day – or 3.8 terajoules per day energy equivalent – in the first 30 days since it was brought back online on August 3. It says the rates are some 30 per cent greater than pre-soak rates achieved during this year’s first quarter.
Empire Energy Group managing director Alex Underwood said: “We continue to progress our planning of the Carpentaria Pilot Project and are on track to seek a final investment decision from the Board to progress to commercial production from EP 187 in the months ahead. In the success case, Empire may commence commercial production from the Beetaloo Basin.by early 2025, a time when incremental gas supply into the Northern Territory and Australia’s east coast will be critical as existing sources of supply decline”.
The company says both horizontally-completed wells could be utilised for future development scenarios such as the Carpentaria pilot project to service the town of Daly Waters, Darwin, Alice Springs and regional centres, in addition to the McArthur River Mine that utilises the existing McArthur River and Amadeus gas pipelines.
It will be achieved in collaboration with APA Group, Australia’s leading energy infrastructure provider, through an executed memorandum of understanding (MOU). APA will leverage its existing gas transmission network to get gas production to market.
Empire’s bigger development plan incorporates a “Northern Strategy” to feed gas to Darwin for manufacturing and liquefied natural gas (LNG) for export and an “Eastern Strategy” to incorporate a new Beetaloo pipeline to Mount Isa and then to utilise existing pipelines to provide gas to the eastern seaboard, where a substantial shortfall is forecast. A MOU has already been signed off with the NT’s Power and Water Corporation for potential gas sales and utilisation of the existing McArthur River Pipeline.
APA will fund infrastructure facilities construction for up to $5 million, materially reducing Empire’s capital requirements to start commercial production. The latter says it is targeting a final investment decision for the pilot project later this year and aiming for first gas sales in the first half of next year.
Empire’s path to development and gas production is proceeding unswervingly as it grows the resources of EP 187, pending the testing outcomes of C-3H, obtains approval for a petroleum production licence and arranges finance through its approved Macquarie Bank credit facility for the pilot plant, for an initial gas rate of 25 terajoules per day. With 1 petajoule capable of powering 19,000 homes for a year, the gas could represent a major transformative power solution for Australia.
So it seems as though it won’t be long before the cash registers start churning for Empire as it gets all of its development ducks in a row for its maiden gas production from a world-class asset.
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By Gary Kjellgren
