Real Energy joint venture gets government go-ahead at Venus

The Queensland Government has granted title of the Venus coal seam gas permit ATP 2051 to Real Energy Corp., Sydney, and its 50% partner, Strata-X Energy Ltd., Denver, effectively giving approval to begin re-entry of the Connor-1 well to reservoir enhance and flow test the upper Walloon coals in the Project Venus region of the Surat basin.

The coals are immediately adjacent to gas infrastructure and are prospective for CSG over the entire permit which has an aerial extent of 152 sq km. A recent independent review of the data in and around the permit certified a prospective gas resource of 658 bcf.

Real Energy will be the administrative and commercial operator while Strata-X will be technical operator, at least for the drilling, testing, and evaluation phase.

There are several previously drilled CSG and conventional wells in and around the permit, including a fully-cored well that indicates the upper Walloon coal seams are gas saturated.

Connor-1 was drilled immediately adjacent to this core hole, but never properly flow tested.

The Project Venus program of re-entry is designed to prove sufficient water flows to enable dewatering and early gas flows from the Walloon coals. If the re-entry flow test goes to plan, the JV expects to drill two wells offsetting Connor-1 and fully equip all three wells as a production pilot program.

This program will include long-term flow testing of the upper Walloon coals to prove commercial gas flow rates. If successful, the partners can begin to progressively convert the prospective gas resource into reserves and fast-track development of the project to potentially gain early cash flow.