Elixir to spud Queensland gas well in October
Sydney-listed Elixir Energy has set the planned spud date for the Daydream-2 appraisal well in Queensland in late October this year, the company announced on July 3. The objective of the well is to expand the contingent resource of the Grandis gas project, which has already been independently certified at 395bn ft3.
Elixir has entered into a rig services contract with a subsidiary of global oil field services company SLB (formerly known as Schlumberger) for the provision of SLB 185 rig. This rig has previously drilled successful wells in the Taroom Trough. The necessary landholder and regulatory approvals have been obtained, and preparatory civil works are expected to commence in late July.
The Daydream-2 well will be drilled to a total depth of approximately 4,200 m and will target the gas-saturated Permian section, which was proven in the Daydream-1 well located about 5 km to the west. The well will focus on both the sandstones and gassy coal seams within this section.
Elixir has announced that the Australian federal government will cover 43.5% of the total cost of the Daydream-2 well through its R&D tax incentive mechanism. The company also mentioned that project debt finance is readily available, secured only on the R&D grant, if it proves advantageous.
The Grandis project is located near the Wallumbilla gas hub, allowing easy access to domestic and international gas markets.