It is the result that everyone with any interest in the Australian oil and gas industry has been waiting for; the flow test numbers from Warrego Energy (ASX:WGO) and Strike Energy’s (ASX:STX) West Erregulla-2 gas well in the Perth Basin.

And what numbers they are.

This morning, Warrego revealed that the well had produced a stunning 69 million cubic feet of gas per day (MMcfd) from the primary target Kingia Sandstone, well above the – probably conservative – 50 MMcfd target that operator Strike had estimated in September.

Fun fact: 1 MMcfd converts neatly into 1000 million British Thermal Units (MMBtu). A single Btu is a traditional unit of heat required to raise the temperature of one pound of water by one degree Fahrenheit while 1 MMBtu is enough to heat up 12,800 cups of coffee. That’s a lot of cups of joe.

The result also compares very favourably to the flow test results from the initial wells at the nearby (and producing) Waitsia gas field, dwarfing all of them save the Waitsia-3 appraisal well.

Where it becomes even more interesting is that the flow rates achieved by Warrego and Strike were limited by the constraints of the surface equipment, which strongly suggests that the Kingia Sandstone reservoir at this location has the capacity to flow gas at higher rates.

That’s one big gas flare Pic:Strike Energy

“The flow test results from West Erregulla-2 have exceeded our initial expectations and demonstrate the exceptional quality of the Kingia reservoir in terms of porosity, permeability and pressure,” Warrego managing director Dennis Donald said.

“This test further validates our view that West Erregulla is one of the best resources in the onshore Perth Basin.

“We will incorporate data from the flow test into our models and anticipate being in a position to update our contingent resources for West Erregulla as soon as practical.

“We also look forward to advancing a gas balancing agreement with our joint venture partner and addressing ourselves to gas marketing options and opportunities to enable the development of the field.”

Donald added that the partners will carry out more 3D seismic and drill additional wells in 2020 to define the field and the extent of the resource.

“Only 1/3 of the EP469 Block area has been mapped by 3D seismic and we are optimistic that further West Erregulla-like resources will be identified during the 2020 campaign,” he added.

Listen: The Wildcatter Podcast with Peter Strachan: Warrego Energy


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In other energy news today:

Hawkley Oil and Gas (ASX:HOG) has entered into an agreement to acquire a 33 per cent interest in a producing oil and gas project in North Dakota, USA for US$2.51 million in cash and shares.

The project produced an average of 133 barrels of oil, 368,000 cubic feet of gas and 42 barrels of natural gas liquids per day during the 12 months to June 2019 and includes opportunities to increase production.

At Stockhead, we tell it like it is. While Warrego Energy is a Stockhead advertiser, it did not sponsor this article.