Empire/Beetaloo stimulates gas extraction at massive NT project

Empire Energy Group, under its new name Beetaloo Energy Australia, has kick-started hydraulic stimulation activities at the company’s 3.31-kilometre-long Carpentaria-5H horizontal well in the Northern Territory’s massive Beetaloo Basin.

The new moniker reflects the company’s determination to focus on the Beetaloo sub–basin and positions itself to become the nation’s next big onshore gas player. It will migrate from the ASX ticker EEG to BTL from the start of trading tomorrow.

Beetaloo plans to complete more than 60 stimulation stages along a 3.31km, 5.5-inch cased section within the Velkerri B shale in the well, which is the longest horizontal well in the Beetaloo sub-basin. Beetaloo expects the program will take four weeks.

The Carpentaria-5H well sits within the company’s Beetaloo Basin EP187 permit. Along with the Carpentaria-2H and Carpentaria-3H wells, Carpentaria-5H forms part of the company’s Carpentaria pilot project. The 2H and 3H wells were drilled and stimulated from the same well pad.  

Beetaloo used specialist firms to refine the design of the stimulation program to ensure it considered lessons learned from previous well stimulation programs.

It has charged industry-leading firm Halliburton with stimulating the super-long well. Halliburton’s equipment will provide much-needed punch to the program, which is designed to maximise production rates and gas recovery levels.

Due to the longer well length and larger casing diameter, the stimulation program design will utilise an increased 42,000 hydraulic horsepower for larger pumping rates, increased fluid and proppant (sand) intensity, and a dedicated slickwater design. It includes a revised perforation strategy and various other enhancements.

The benchmarks include a 100-barrel (bbl) per minute pump rate, 50bbl per foot slickwater stimulation fluid intensity and a 2400-pound per foot proppant intensity.

Beetaloo Energy managing director Alex Underwood said: “The stimulation of Carpentaria-5H is an historic moment in the development of the Beetaloo Basin. This is the first well in the basin targeting a stimulation across a 3km horizontal section.” 

Underwood said horizontal drilling and hydraulic stimulation revolutionised the United States’ energy system, driving down energy prices and emissions intensity while stimulating economic activity. Australia has the same opportunity through the development of the Beetaloo Basin, he said.

When the stimulation program finishes, Beetaloo will undertake a 30-day clean-up and soak, followed by a 30-day production test to check the flow rate levels. The company anticipates the release of IP30 flow rates within the next three months.

The 3.31km horizontal well sits at an average depth of 1580 metres below ground within a 70m-thick B shale reservoir.

The planned stimulation of more than 60 stages will use the standard plug and perf technique.

Commonly used in shale formations, the technique involves setting temporary bridge plugs at specific intervals within a wellbore to isolate and treat different zones sequentially.

After setting the plug, perforating guns are used to create openings in the well casing and surrounding formation. The perforations allow the hydraulic stimulation fluid to be pumped in to fracture the rock.

Following successful hydraulic stimulation and production flow testing, the company plans to construct the Carpentaria pilot project. The project will determine a long-term production curve to support future development planning. 

When the well has been stimulated, it will be shut in and tied into the Carpentaria gas plant for production. Beetaloo will then seek the regulatory nod for gas sales under the NT’s beneficial use of test gas rules. 

Management plans to eventually draw sufficient gas from the basin to supply the NT government with as much as 100 terajoules of gas per day. 

Beetaloo holds a commanding 117,000 square kilometres of prospective exploration tenements in the NT’s McArthur Basin and Beetaloo sub-basins. Both basins offer enormous hydrocarbon potential.

The company remains stacked with funds, highlighting its cash at bank is a healthy $40.5 million. It follows the company raising a handy $28 million in May to bolster its Beetaloo Basin exploration plans.

Beetaloo also retains access to $28.8 million in undrawn Macquarie Bank facilities. 

Boosted by continual funding, its large cash holding and a world-class gas region, Beetaloo has come far. Test flow results expected in the next few months should provide a guide to just how far Carpentaria has come along the path to success.

Is your ASX-listed company doing something interesting? Contact: mattbirney@bullsnbears.com.au