Falcon Oil & Gas Ltd. - Kyalla 117 N2-1H ST2 Update
Falcon Oil & Gas
Ltd.(“Falcon” or the
“Company”)
Kyalla 117 N2-1H ST2
Update
7 October 2021 - Falcon Oil & Gas Ltd.
(TSXV: FO, AIM: FOG) notes that production testing has now been
completed and the well shut in at Kyalla 117 N2-1H ST2
(“Kyalla 117”) in the Beetaloo Sub-Basin, Northern
Territory, Australia with our joint venture partner, Origin Energy
B2 Pty Ltd., a wholly owned subsidiary of Origin Energy
Limited.
As noted in the Company’s press release on 20
July 2021, while Kyalla 117 flowed liquids-rich gas without
assistance for intermittent periods, production was not sustained
and there were indications of a potential downhole flow
restriction.
On 14 September, coil tubing operations
recommenced at Kyalla 117. No apparent restriction or blockage was
identified in the production casing. Following a nitrogen lift, the
well was able to flow unassisted at rates between 0 (i.e. rates too
small to measure) and 1.5 MMcsfd for five days before loading up
with water. Gas compositions data are not yet available but gas
specific gravity data is similar to that measured during the
previous phase of testing. Trace condensate was also observed.
Further analysis will be undertaken, including
additional core analysis and well design considerations, to enable
a conclusion to be reached on the results from operations at Kyalla
117, which will inform the future approach to further drilling and
testing of the Kyalla play in the Beetaloo Sub-basin.
The purpose of the current exploration campaign
was to collect data across the three primary plays within the
permits: Velkerri dry gas, Velkerri liquids rich, and Kyalla
liquids rich. Despite the challenges, the Kyalla remains a viable
target within the Beetaloo. Kyalla 117 was the first horizontal
well targeting the Kyalla and achieved its primary technical
objective of demonstrating liquids rich gas flow potential of the
Kyalla.
Recap on the gas composition
The initial analysis of natural gas by gas chromatography confirmed
a liquids-rich gas stream low in CO2 as follows:
- C1 = 65.03 mol%
- C2 = 18.72 mol%
- C3 = 8.37 mol%
- iC4 = 1.29 mol%
- nC4 = 2.03 mol%
- C5+ = 2.73 mol%
- CO2 = 0.91 mol%
- N2 = 0.92 mol%
The elevated C3+ gas component of 14.42 mol%,
confirmed the Lower Kyalla Shale as a liquids-rich gas play. Gas
composition data also support the view that the Kyalla gas stream
will have elevated LPG and condensate yields.
This announcement contains inside
information.
Philip O’Quigley (CEO of Falcon)
commented:“The information collected from this first
horizontal well drilled in the Kyalla liquids-rich play, including
the elevated liquids component, confirmed that the Kyalla remains
an attractive target for further appraisal. Our immediate focus
will now turn to the Velkerri play area where we are currently
drilling a new exploration well in the potentially liquids-rich
flank of the basin; an area of key interest for the Beetaloo
Sub-basin. We look forward to updating the market as soon as the
results from this well are available”
Ends.
CONTACT DETAILS:
Falcon Oil & Gas Ltd.
|
+353 1 676 8702 |
Philip O'Quigley, CEO |
+353 87 814 7042 |
Anne Flynn, CFO |
+353 1 676 9162 |
|
Cenkos Securities plc (NOMAD & Broker) |
|
Neil McDonald / Derrick Lee |
+44 131 220 9771 |
|
|
Camarco |
|
James Crothers / Rebecca Waterworth / Billy Clegg |
+44 (0)20 3781 8331 |
This announcement has been reviewed by Dr. Gábor
Bada, Falcon Oil & Gas Ltd’s Head of Technical Operations. Dr.
Bada obtained his geology degree at the Eötvös L. University in
Budapest, Hungary and his PhD at the Vrije Universiteit Amsterdam,
the Netherlands. He is a member of AAPG.
About Falcon Oil & Gas
Ltd.Falcon Oil & Gas Ltd is an international oil &
gas company engaged in the exploration and development of
unconventional oil and gas assets, with the current portfolio
focused in Australia, South Africa and Hungary. Falcon Oil &
Gas Ltd is incorporated in British Columbia, Canada and
headquartered in Dublin, Ireland with a technical team based in
Budapest, Hungary.
Falcon Oil & Gas Australia Limited is a c.
98% subsidiary of Falcon Oil & Gas Ltd. Falcon Oil & Gas
Australia Limited and a wholly-owned subsidiary of Origin Energy
Limited (ASX: ORG) (“Origin Energy”) are joint
venture partners in respect of the Beetaloo project.
For further information on Falcon Oil & Gas
Ltd. please visit www.falconoilandgas.com
About Origin EnergyOrigin
Energy is a leading Australian integrated energy company. Origin is
a leading energy retailer with approximately 4.2 million customer
accounts, has approximately 7,500 MW of owner and contracted power
generation capacity and is also a large natural gas supplier.
Origin is the upstream operator of Australia Pacific LNG, which
supplies natural gas to domestic markets and exports LNG under long
term contracts.
www.originenergy.com.au
Glossary of terms
C1 |
Methane |
C2 |
Ethane |
C3 |
Propane |
C3+ |
Propane and heavier constituents of natural gas |
iC4 |
Iso-Butane |
nC4 |
N-Butane |
C5+ |
Pentane and heavier constituents of natural gas |
CO2 |
Carbon dioxide |
LNG |
Liquefied natural gas |
LPG |
Liquefied petroleum gas |
MMscf/d |
Million standard cubic feet per day |
mol% |
mole percent |
N2 |
Nitrogen |
MW |
Megawatt |
Advisory regarding forward looking
statementsCertain information in this press release may
constitute forward-looking information. Any statements that are
contained in this news release that are not statements of
historical fact may be deemed to be forward-looking information.
Forward-looking information typically contains statements with
words such as “may”, “will”, “should”, “expect”, “intend”, “plan”,
“anticipate”, “believe”, “estimate”, “projects”, “dependent”,
“potential”, “scheduled”, “forecast”, “outlook”, “budget”, “hope”,
“support” or the negative of those terms or similar words
suggesting future outcomes. In particular, forward-looking
information in this press release includes, but is not limited to,
comments made with respect to the results of operations at Kyalla
117, drilling in the Velkerri play, the prospectivity of the Middle
Velkerri and Kyalla plays and the prospect of the exploration
programme being brought to commerciality. This information is based
on current expectations that are subject to significant risks and
uncertainties that are difficult to predict. The risks, assumptions
and other factors that could influence actual results include risks
associated with fluctuations in market prices for shale gas; risks
related to the exploration, development and production of shale gas
reserves; general economic, market and business conditions;
substantial capital requirements; uncertainties inherent in
estimating quantities of reserves and resources; extent of, and
cost of compliance with, government laws and regulations and the
effect of changes in such laws and regulations; the need to obtain
regulatory approvals before development commences; environmental
risks and hazards and the cost of compliance with environmental
regulations; aboriginal claims; inherent risks and hazards with
operations such as mechanical or pipe failure, cratering and other
dangerous conditions; potential cost overruns, drilling wells is
speculative, often involving significant costs that may be more
than estimated and may not result in any discoveries; variations in
foreign exchange rates; competition for capital, equipment, new
leases, pipeline capacity and skilled personnel; the failure of the
holder of licenses, leases and permits to meet requirements of
such; changes in royalty regimes; failure to accurately estimate
abandonment and reclamation costs; inaccurate estimates and
assumptions by management and their joint venture partners;
effectiveness of internal controls; the potential lack of available
drilling equipment; failure to obtain or keep key personnel; title
deficiencies; geo-political risks; and risk of litigation.
Readers are cautioned that the foregoing list of
important factors is not exhaustive and that these factors and
risks are difficult to predict. Actual results might differ
materially from results suggested in any forward-looking
statements. Falcon assumes no obligation to update the
forward-looking statements, or to update the reasons why actual
results could differ from those reflected in the forward
looking-statements unless and until required by securities laws
applicable to Falcon. Additional information identifying risks and
uncertainties is contained in Falcon’s filings with the Canadian
securities regulators, which filings are available at
www.sedar.com, including under "Risk Factors" in the Annual
Information Form.
Advisory regarding initial production
rates
Any references in this news release to initial
production rates are useful in confirming the presence of
hydrocarbons; however, such rates are not determinative of the
rates at which such wells will continue production and decline
thereafter and are not necessarily indicative of long-term
performance or ultimate recovery. While encouraging, readers are
cautioned not to place reliance on such rates in calculating the
aggregate production for Falcon. Such rates are based on field
estimates and may be based on limited data available at this
time.
Neither the TSX Venture Exchange nor its
Regulation Services Provider (as that term is defined in the
policies of the TSX Venture Exchange) accepts responsibility for
the adequacy or accuracy of this release.
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