Kinetiko Energy Ltd (ASX:KKO, OTC:KKOEF) is advancing a strategy to provide new sources of badly needed energy in South Africa with further strong gas results recorded from two core holes on its acreage near key energy infrastructure.
Core wells 272-06C and 272-08C spudded in early June and in close proximity to Sasol’s Secunda refinery, the Tutuka Power Station and South Africa’s largest gas pipeline the Lily pipeline, have been completed with logging results indicating strong potential for gas field development.
Wireline logging results from the third and fourth core holes in ER272 have established significant sandstone gas intervals in both wells, continuing the Australian gas explorer and developer’s run of success in South Africa.
“Fantastic log results”
Kinetiko CEO Nick de Blocq said: ”We are very excited by the fantastic log results from all four core holes to date.
“The second pair of core holes were drilled equidistant between Sasol’s Secunda Plant (a potential gas off-taker) and the Tutuka Power Station.
"For the shallowest core holes in our entire acreage, to achieve an average of over 147 metres of gas-bearing sediments from our most recent pair is astounding.”
Exploration ongoing
What’s more, Kinetiko is confident of achieving further success in its ongoing exploration program with two further core wells expected to be spudded in ER272 this week.
Continued core well success increases the confidence of gas field development only a few kilometres from major South African energy infrastructure.
The logging results from the first two core wells in ER272 are very promising, establishing that ER272 has a higher ratio of gassy sandstone than the other areas the company has explored.
Greater gas intervals
These results have yielded greater gas intervals than those in the first two core wells in ER272 with 130 metres plus net pay just like many core wells in ER271, but with lower costs per well due to the shallower depth.
Location of core wells 272-016C and 272-028C in proximity to energy infrastructure.
Core wells 272-06C and 272-08C were the third and fourth gas exploration wells in Northern ER272, in between the Sasol synfuel/chemical plant at Secunda, 15 kilometres to the northwest, and the Tutuka Power Station 14 kilometres to the southeast.
272-06C results
Core well 272-06C wireline logging results illustrating 166-metre gas pay zone.
The wireline logging results for 272-06C (above) show the sandstone intervals of 166 metres (pink shading) identified by gas effect of cross-over between the neutron porosity curve (blue line on right track) and the density porosity curve (red line on right track).
The gassy sandstones are weighted to the lower part of the hole, where the gas pressure and volume will be highest.
The other formations below the capping dolerite are coals and carbonaceous sandstones, siltstones and mudstones. These are the source rocks for the gas in the porous sandstones highlighted in pink.
The Dwyka sandstone development in core well 272-06C (291-343 metres) is the thickest seen in any of Kinetiko’s holes to date.
272-08C logging
Core well 272-08C wireline logging results illustrating 134-metre gas pay zone.
The logging results from core well 272-08C (above) established sandstone intervals of 134 metres.
The chart shows (pink shading) identified by gas effect of cross-over between the neutron porosity curve (blue line on right track) and the density porosity curve (red line on right track).
This is the fourth gas exploration hole in ER272.
Offtake talks imminent
"We know that a lot of the core hole stratigraphy consists of dolerites in the region, so we can safely say that a large percentage of the sub-igneous zones drilled through will contribute strongly to eventual gas flow,” the CEO added.
"Now that we have high-quality, corroborative data across a high-potential production area, we will be talking with potential off-takers very soon.”
What comes next?
The company continues with its exploration program with two further core holes expected to be spudded in ER272 next week.
This will complete a series of six core wells that will have been completed on time and on budget in ER 272.
Continued coring success increases confidence of potential development of a gas production field only a few kilometres from major South African energy infrastructure in search of gas.