Pure Hydrogen pumped about initial Project Venus test results
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Pure Hydrogen’s Project Venus in Queensland’s Surat Basin hosts substantial coal seam gas resources that are worth a pretty penny at today’s gas prices.
An independent review by Sproule has estimated that the project has best estimated contingent resources of 130 petajoules with potential for further drilling to upgrade the remaining prospective resources.
With wholesale gas prices on Australia’s east coast currently ranging between $6 to $8 per gigajoule, the review highlights the strong value of the company’s gas resources.
Pure Hydrogen (ASX:PH2) managing director Scott Brown said he was very pleased with the findings of the independent review.
“There is gas there in big quantities,” Brown said. “We will do further testing now to reveal what the flow rate would be and how quickly we would be able to get it out.”
The tested pilot well Venus 1 covers 154sqkm and is positioned “smack bang in the middle” of Queensland’s CSG-rich Surat Basin, close to gas infrastructure and only three hours’ drive west of Brisbane.
Brown said the initial three-month controlled drawdown flow test started last week and he was happy to confirm that early results after a small drawdown had resulted in increasing water flows.
Unlike conventional gas wells that are drilled into sandstone or shale formations that host the hydrocarbons, CSG wells are drilled into coal seams – often vertically. This is then followed by a period of de-watering the well to reduce pressure before gas production in any significant quantities begins.
CSG wells typically have a high rate of water production and gas flows gradually increases as the water rate decreases. Once gas flow rates peak they then tend to decline at a variable rate.
Brown said the testing program would continue over the next three months and, if results continued to be positive, the project would be advanced to the development phase with more wells to be drilled as production wells.
PH2 would then decide whether to use the reserves to supply Australia’s gas-hungry east coast or capture the gas for conversion into highly marketable hydrogen and carbon products such as in-demand graphene.
“Our hydrogen operations are advancing favourably,” Brown said. “Work is also advancing in Botswana as our partner prepares for the drilling program at the Serowe CSG Project there.
“Our CSG assets in the Surat and in Botswana have significant potential and we look forward to reporting on material progress as both work programs advance.”
This article was developed in collaboration with Pure Hydrogen, a Stockhead advertiser at the time of publishing.
This article does not constitute financial product advice. You should consider obtaining independent advice before making any financial decisions.