Elixir Energy Ltd (ASX:EXR) continues to countdown toward drilling of the high-impact Daydream-2 appraisal well within its 100%-owned Grandis Gas Project in Queensland’s Taroom Trough.
Preparations continue at a solid pace with well site and access road civils work underway while a water well rig is at the site and drilling ahead.
Long lead items have been procured for the program with tier-one contractors appointed for the well, which is set to play an important role in feeding energy-hungry east coast markets.
In another pre-drilling development, the company has also ordered a desorption analysis laboratory which will be set up on-site for deep coal targets and has the potential to contribute to an increase in the gas-in-place volumes.
Taroom Trough “activity growing”
Elixir’s managing director Neil Young said: “The countdown to the drilling of the high-impact Daydream-2 well continues apace and we are pleased to report strong progress on all fronts.
"As indicated by our recent execution of a data sharing agreement with Santos, activity in the broader Taroom Trough is growing – reflecting its great market location and very large known gas resources.”
To pave the way for civil works on site, the relevant ground received the appropriate cultural heritage clearance from representatives of the Mandandanji people.
The civil works for the Daydream-2 appraisal well kicked off last week with construction of the well pad and upgrade of pre-existing access roads.
Water well drilling
Drilling of an on-site water well is now underway with this well to have a target depth of 1,200 metres.
This will provide all the water needs for the upcoming drilling and stimulation programs, not just for Daydream-2 but also for future wells in the same area.
Importantly, it will be the only water well accessing the target aquifer in a wide region, and as such does not compete with water used for existing agricultural activities.
Elixir has procured all key long lead items for Daydream-2, including a high-pressure rated blowout preventer (BOP), casing and a well head.
All tier-one contracts have also been awarded for drilling fluids, cementing, wireline & mud logging, measurement while drilling (MWD) and drill bits.
On-site desorption lab
The company’s previously released estimates of prospective resources in the deep coal formations in the Taroom Trough were based on gas-in-place estimates within the coal fracture system only.
A recent review of offset well cores indicates good prima facie fracturing and parting.
Full-hole core of a Permian coal lithology at the nearby Dunk-1 well.
Elixir’s technical team now considers it feasible that additional gas in place could still exist adsorbed to the coal matrix.
To that end, the company will mobilise an on-site desorption lab from ALS to undertake gas content measurements from cuttings taken from the Permian coal measures. If successful, this could contribute to an increase in the gas-in-place volumes.
Supporting activities
In the lead-up to the spudding of the well, supporting activities over the next few weeks will include:
- Finalising the construction of the pad and access road for Daydream-2;
- Completing the drilling of the on-site water well;
- Testing of the BOP; and
- Finalising with SLB the official rig release date for the contracted SLR 185 rig from the current operations – this is still expected to be in October such that the well will spud a few weeks after.