These junior gas plays are bringing new supply to the Australian market

Gas remains key to Australia’s energy mix
Two ASX listed juniors pushing to develop new supplies include Strike Energy and State Gas

Gas remains key to Australia’s energy mix with the Federal Government continuing to stand firm on the need for the fossil fuel to complement a transition to the government’s target of 82% renewable generation by 2030.

This is despite pressure from the Greens, which is calling for bans on further fossil fuel developments in return for its support for the Albanese government’s changes to the Safeguard Mechanism.

Realistically, there isn’t much going for this stance given that Australia’s demand isn’t going away anytime soon while domestic supplies are declining.

Given this, it is no surprise that ASX listed juniors have been pushing to develop new supplies of gas with these companies reporting progress today.

Strike Energy (ASX:STX) is just one approval away from bringing its Walyering field in the Perth Basin, Western Australia, into production following the approval of the Environmental Plan for its construction and commissioning.

It is now awaiting approval of the safety case, which allow construction to begin.

This is expected to take about six weeks to complete with sales beginning in April subject to completion of the connection to APA Group’s Parmelia Gas Pipeline and final quality assurances of the upstream facility.

Strike noted that the workover rig is currently at the Walyering-5 well and will move it to Walyering-6 to install the production completions.

The two wells have gross Proved and Probable (2P) reserves of 54 petajoules of gas, Best Estimate (2C) Contingent Resources of 32PJ of gas and 800,000 barrels of associated condensate.

This will be produced through a production facility capable of producing up to 33 terajoules of gas and 250 barrels of condensate per day.

The facility, which will be the closest source of gas to the major Southwest market and will be powered purely by solar and battery storage giving it one of the lowest emissions intensities for current WA domestic supplies.

East coast gas supplies

Over in the east, State Gas (ASX:GAS) has flagged that gas flow from the Rougemont 2/3 lateral coal seam gas well within the Rolleston-West is approaching economic levels.

The well is currently flowing gas at rates in excess of 350,000 cubic feet per day and increasing at a rate of between 15,000 and 20,000 cubic feet each day.

Should production continue to increase at this pace, the company might temporarily relocate its relocatable compressed natural gas compression assets from the Reid’s Dome field to Rougemont.

Doing so would allow the company to produce positive cashflow from gas that would otherwise be flared whilst preserving the conventional supplies at Reid’s Dome as a quick response to what should be an increasingly volatile domestic market following the closure of the Liddell coal fired power station in April.