Comet Ridge s Galilee Basin Extended Production Test Project Galilee Basin Coal & Energy Conference 2013 Tor McCaul, Managing Director 25 November

Transcription

1 Comet Ridge s Galilee Basin Extended Production Test Project Galilee Basin Coal & Energy Conference 2013 Tor McCaul, Managing Director 25 November 2013

2 Introduction Comet Ridge Limited Strategic CSG assets Large resource and equity positions Multi-basin exposure Significant 3C Resource base Domestic and export market opportunities Tightening east Australian gas market Quality team Highly experienced board and management team Combines technical and commercial; CSG and conventional; upstream and downstream capability Combines experience with majors and successful independents Focus on reserve certification Initially at Mahalo Block in Bowen Basin with two pilot schemes operating Galilee Basin has significant gas resources over large area NSW blocks also with significant resource base and large upside 2

3 Contents Galilee Basin Gas Assets Extended Production Test Commercial Options 3

4 Section 1 Galilee Basin Gas Assets 4

5 Galilee Basin Background Large area (~250,000km 2 ) covering a big part of central western Queensland Overlain by Eromanga Basin and underlain by Drummond Basin Land use is grazing cattle and sheep Oil recoveries and conventional gas flows over a number of years One working pilot in the basin Significant coal mine province evolving in the shallow coals in the east 5

6 Eastern Basin Geology Betts Creek coals Permian in age Up to 6 individual seams Thick, continuous coals deposited over very large area Coals shown as gas bearing and permeable Coal sub-crops in the east and dips to the west Net Coal thickness in eastern basin generally 15 to 40m Very large gas volumes in place 6

7 Systematic Path to Reserves

8 Resources Independently Certified Galilee Basin Significant Independent Resource Booking Gunn Project Area 3C Gas Resources are material in size (1,870 PJ) and 100% COI 8

9 Galilee Exploration History 2009 Petroleum Exploration Original Tenure Award Large position almost 13,000km 2 (0.7% of QLD) ATP % equity 12 year term effective September 2009 ~6476km 2 ATP % equity 12 year term effective October 2009 ~6515km 2 9

10 Galilee Exploration History Exploration Program Drilling Program Objectives Confirm coal thickness, depth and continuity Quantify gas content at various depths Quantify coal permeability at various depths Obtain water samples from the Betts Creek coals Better understand Galilee depositional architecture 10

11 Galilee Exploration History Exploration Program 5 well exploration program Total drilled section 5010m Coal thickness ranged from 16m to 24m with up to 22m of shale Over 1000m core cut & 10 drillstem (flow) tests Significant laboratory coal analysis Gunn Project Area average gas content 4.3 m 3 /t (high 7.3 m 3 /t) Outcome: focus on south-west region Gunn Project Area 11

12 Galilee Exploration History 2011 Gunn 2D Seismic Survey Seismic Program Objectives Confirm coal continuity Improve understanding of structural features Define project area 252km 2D seismic survey First modern 2D seismic in these blocks Excellent image quality in Betts Creek Beds Improved understanding of the structural nose controlling gas content and permeability Top Permian Gunn

13 Galilee Exploration History 1015P Farm-in Area 2012 farm-in to southern part of ATP1015P held by QER Access to additional 825km 2 Creates continuous acreage area, extending Gunn Project area to the east Three stages to allow equity up to 75% Stage 1 completed- two appraisal wells in Farm-in Area earning 20% equity 13

14 Galilee Exploration History Exploration Program 3 well exploration and appraisal program Gunn 2 drilled in ATP744 Gunn Project Area 16.2m net coal Four coal intervals tested demonstrated good to excellent productivity 2 wells ATP1015 Farm-in area 20 to 23 m net coal Good gas content and permeability Confirmed extension of Gunn Project Area to the east 14

15 Gunn Project Area Gunn Project Area 5 coal seams intersected depth to coal m >16m net coal gas contents >4m 3 /t good permeability within target coals Gunn Project area and Farm-in area coals contain recoverable gas over an estimated area of 1865km 2 15

16 Additional Gas Potential Conventional and Unconventional Potential 3 historic petroleum wells within ATP 743 and ATP 744 recovered oil and/or gas from Lake Galilee Sandstone at base of Galilee Basin Carmichael 1 well flowed gas to surface from deeper sandstone intervals Evidence of active petroleum system over the Koburra Trough Potential for additional oil and gas resources GTS recovered gas to surface OTS recovered oil to surface 16

17 Section 2 Gunn 2 Extended Production Test 17

18 Gunn 2 Extended Production Test (EPT) Gunn 2 - EPT Nov Gunn 2 completed for production Nov to Jan Surface facilities installed - water storage tanks, flowlines, metering facilities and power generation Jan 2013 commissioned for operation EPT Objectives Establish connectivity with coals (i.e. completion methodology) Obtain water samples 18

19 Gunn 2 Production Well Design Steel casing run and cemented in place with cement returns all the way back to surface This allows flow into the well of only the selected zone(s) For Gunn 2, only 4 metres of coal perforated and flowed into the well for pumping to surface Betts Creek Coals sit well below Great Artesian Basin units

20 Gunn 2 Extended Production Test Gunn 2 - EPT Perforated over four metre interval - C1 coal seam only Seam isolated above and below by impermeable mudstone Designed to ensure water only produced from Betts Creek reservoir coal 20

21 Gunn 2 production test Gunn 2 EPT results Water rate progressively increased over several weeks Stabilized water production rate of 400 bwpd Reached limit of pumping equipment Pressure analysis indicate four metre coal interval has greater flow capacity Formation water samples taken for analysis Water found to be good quality Evaluating methods of formation water treatment Well set up for long term production Success Effective completion style Connecting wellbore to fractures in coal Isolating coal seam from permeable sandstones Formation water samples collected 21

22 Gunn 2 Extended Production Test 22

23 Groundwater Groundwater over ATP s Agricultural Groundwater predominantly sourced from Clematis Group Moolayember Formation Alluvium and colluvium Nil sourced from Betts Creek beds Clematis Group and Moolayember Formation are intake beds for GAB Betts Creek beds sit hundreds of metres below GAB >300m separation between GAB and Betts Creek beds 23

24 Section 3 Commercial Options 24

25 Tightening Eastern Australia Gas Market 4 large LNG consortia control almost 90% of 2P CSG reserves in Eastern Australia Qld domestic gas demand and projected gas demand for LNG exports Intensifying competition for future gas reserves, driven by LNG growth Increasing pressure on domestic gas supply and pricing Gas producers writing new contracts at the higher end of a A$6-9/GJ range and prices are forecast to continue to rise Qld Gas Market Advisor forecasts a domestic supply constraint if supply situation does not improve Source: 2012 Gas Market Review Queensland (Queensland Government) CSG 2P Reserves, February ,776 PJ 7% 5% LNG proponents AGL Other 88% Source: RLMS 25

26 Galilee Basin Commercial Options Galilee Basin market opportunities Different market segments emerging for commercial development: coal, power, LNG Development option 1: Power for coal mines / local generation 26

27 Galilee Basin Commercial Options Galilee Basin market opportunities Development option 2: Gas supply to LNG projects at Gladstone Development option 3: Domestic gas supply via Barcaldine 27

28 To Summarise.. Comet Ridge has built significant eastern basin experience and understanding, positioned within reach of markets Large CSG resources independently certified and deeper sandstone gas present Pilot scheme is the key next step with the aim of conversion of resources to reserves Gas could be directed to power generation, LNG manufacture or domestic gas markets 28

29 Important Notice and Disclaimer Disclaimer This presentation (Presentation) has been prepared by Comet Ridge Limited (ABN ) (Comet Ridge). The Presentation and information contained in it is being provided to shareholders and investors for information purposes only. Shareholders and investors should undertake their own evaluation of this information and otherwise contact their professional advisers in the event they wish to buy or sell shares. To the extent the information contains any projections, Comet Ridge has provided these projections based upon the information that has been provided to Comet Ridge. None of Comet Ridge or its directors, officers or employees make any representations (express or implied) as to the accuracy or otherwise of any information or opinions in the Presentation and (to the maximum extent permitted by law) no liability or responsibility is accepted by such persons. Summary information This Presentation contains summary information about Comet Ridge and its subsidiaries and their activities current as at the date of this Presentation. The information in this Presentation is of general background and does not purport to be complete. It should be read in conjunction with Comet Ridge s other periodic and continuous disclosure announcements lodged with the Australian Securities Exchange (ASX), which are available at ASX Releases Investors are advised that by their nature as visual aids, presentations provide information in a summary form. The key information on detailed Resource statements can be found in Comet Ridge s ASX releases. Resource statements are provided to comply with ASX guidelines but investors are urged to read supporting information in full on the website. Past performance Past performance information given in this Presentation is given for illustrative purposes only and should not be relied upon as (and is not) an indication of future performance. Future performance This Presentation contains certain forward-looking statements. Forward looking words such as, expect, should, could, may, plan, will, forecast, estimate, target and other similar expressions are intended to identify forward-looking statements within the meaning of securities laws of applicable jurisdictions. Indications of, and guidance on, future earnings and financial position and performance are also forward-looking statements. Forward-looking statements, opinions and estimates provided in this Presentation are based on assumptions and contingencies which are subject to change without notice, as are statements about market and industry trends, which are based on interpretations of current market conditions. Such forward-looking statements, opinions and estimates are not guarantees of future performance. Forward-looking statements including projections, guidance on future earnings and estimates are provided as a general guide only and should not be relied upon as an indication or guarantee of future performance. This presentation contains such statements that are subject to known and unknown risks and uncertainties and other factors, many of which are beyond the control of Comet Ridge, and may involve significant elements of subjective judgement and assumptions as to future events which may or may not be correct. It is believed that the expectations reflected in these statements are reasonable, but they may be affected by a range of variables which could cause actual results or trends to differ materially, including but not limited to: price fluctuations, actual demand, currency fluctuations, drilling and production results, reserve estimates, loss of market, industry competition, environmental risks, physical risks, legislative, fiscal and regulatory developments, economic and financial market conditions in various countries and regions, political risks, project delay or advancement, approvals and cost estimates. Such forward-looking statements are relevant at the date of this Presentation and Comet Ridge assumes no obligation to update such information. Investment risk An investment in Comet Ridge shares is subject to investment and other known and unknown risks, some of which are beyond the control of Comet Ridge. Comet Ridge does not guarantee any particular rate of return or the performance of Comet Ridge. Persons should have regard to the risks outlined in this Presentation. Competent Person Statement The gas resource estimates for ATP 774P, ATP 337P, PMP and PMP provided in this statement were determined by Mr John Hattner of Netherland, Sewell and Associates Inc, Dallas, Texas, USA, in accordance with Petroleum Resource Management System guidelines. Mr Hattner is a full-time employee of NSAI, and is considered to be a qualified person as defined under the ASX Listing Rule 5.11 and has given his consent to the use of the resource figures in the form and context in which they appear in this presentation. The resource estimates for PEL 6, PEL 427 and PEL 428 referred to in this presentation were determined by Mr Timothy L. Hower of MHA Petroleum Consultants LLC in accordance with Petroleum Resource Management System guidelines. Mr Hower is a full-time employee of MHA, and is a qualified person as defined under the ASX Listing Rule Mr Hower consented to the publication of certain resource figures which appeared in the announcement of 7 March 2011 made by Eastern Star Gas Limited (ASX:ESG) and any reference and reliance on the resource figures for PEL 6, PEL 427 & PEL 428 in this presentation is only a restatement of the information contained in the ESG announcement. 29

30 Contact Level Elizabeth Street Brisbane 4000 Comet Ridge Limited GPO Box 798 Brisbane 4001 Telephone: Facsimile: info@cometridge.com.au 30