DESPITE some mixed results from Origin Energy yesterday, and a spooked market, one of the highlights of the day was a firm announcement on next year's Beetaloo Sub-basin shale gas plans.
The Beetaloo is considered one of the most prospective parts of the Northern Territory and now the Top End has lifted its fraccing moratorium, albeit with 135 conditions, Origin and partner Irish Falcon Oil and Gas have committed to a new appraisal program for next year.
The focus will be on the liquids-rich Kyalla Formation and Velkerri Shale.
The $60 million program is planned to identify a preferred play ahead of a 2020 pilot program and a possible declaration of commerciality the same year.
The area may have yields of up to 60 million barrels of oil equivalent or 60 million cubic feet of gas, according to RBC Capital Markets.
"We think the Beetaloo is an underappreciated facet of Origin's business," RBC said recently.
"We feel it represents a material growth option for an entity that is somewhat growth constrained given its strong market position in energy wholesaling and retailing and the low return dynamics of new renewables investments."
Until now the Velkerri B Shale has seen well tests while the Lower Kyalla Shale, which sits above it, has been less understood, although data from cores highlights the presence of both oil and gas.
Reservoir indicators include high porosity, hydrocarbon saturations, good source rock, middle to high condensate potential and which will likely be conducive to fraccing.
Previously what was known about the formation had suggested it was clay-prone and not suitable to fraccing.
The Beetaloo Sub-basin, part of the larger McArthur Basin, is estimated to hold almost 70% of the NT gas resources and the majority of relatively cursory exploration has been centred there. Source: Energy News Bulletin