Brisbane-based Senex Energy has commenced the Phase 2 drilling campaign at its flagship Western Surat gas project, designed to deliver coal seam gas from north of Roma in Queensland.
Located in the onshore Surat basin, the campaign involves the drilling of 30 wells on the Glenora and Eos blocks, situated directly north of the Gladstone liquefied natural gas project’s (GLNG) producing Roma field.
The Santos-led GLNG development produces natural gas from Queensland’s coal seams and converts it into LNG, and Senex has a gas sales agreement with the GLNG joint venture to supply up to 50 TJ/d of gas from the Surat project over 20 years.
Phase 2 drilling will be undertaken over the remainder of the calendar year with the first wells expected online in Q1 FY18.
Senex has locked in pricing with suppliers for a significant proportion of the AU$50 million Phase 2 work program which includes the construction of gas and water handling infrastructure.
A number of contractors local to the Roma region are involved in delivering the work program.
Director and CEO Ian Davies said the company was focused on executing the work program on schedule and on budget.
“We are working hard alongside our suppliers to set Phase 2 up for success. Senex will take the opportunity to fully embed its design, contracting and execution methodology on the Phase 2 work program ahead of its transition to full field development,” he said.
Senex holds 100% interest in and operatorship of the Western Surat gas project, expected to support up to 425 wells. The firm delivered first gas from the project in 2016, with first appraisal wells online as part of the pilot program.
In February, Senex announced that it had formed a partnership with specialist energy investor EIG Global Energy Partners, which will see the latter fund up to US$300 million for Western Surat gas project acceleration.
Under the terms of the agreement, EIG became a substantial shareholder in Senex, holding 12.2% of Senex’s issued share capital. A total of $55 million was raised through the institutional placement to EIG.
During the March quarter, Senex recorded 14% lower sales revenue of AU$11 million.
Image: Map of Western Surat Gas Project / Senex
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