Blue Energy reports early gas in commissioning of Sapphire pilot wells

Early gas was seen onshore during the commissioning phase of Blue Energy’s (ASX: BLU) Sapphire 5 and Sapphire 6 pilot wells in Queensland’s Bowen Basin.

Activities confirmed the presence of hydrocarbons from the upper coals at both lateral wells, with gas flaring observed despite minimal dewatering.

Blowdown to the Sapphire 6 flare stack installation recorded a peak instantaneous gas rate of 1.6 million standard cubic feet per day over an eight-hour blowdown period.

Blue said the presence of early gas confirms the high saturation of respective coals in the Sapphire Block, previously determined in pre-drilling.

Dewatering process

The Sapphire 5 and 6 vertical wells are now pumping to begin a gradual dewatering process on the separate seams (laterals) in the pilot well set.

This is expected to slowly reduce the pressure on the coals in the lateral wells and build gas rates to establish peak sustainable gas flow rates over time.

Completion of the Sapphire well followed a period of intense drilling activity in November with a total of 14,000 meters drilled, including 8,000m of in-seam coal section from seven lateral drill holes.

Bowen Basin objective

Blue’s objective in the Bowen Basin was to build the gas reserve base (by converting 3C resources to 2P reserves) from an existing stock of 3C resources located in the Sapphire Block of ATP 814P.

Drilling targeted several coal seams, with dedicated lateral wells at separate seams.

Each lateral well was drilled at least 1000m into coal and intersected the Sapphire 5 and Sapphire 6 vertical water drainage wells 1.4 kilometers away which were drilled as part of the same program.

The lateral wells were drilled with seismic control and the stratigraphy was confirmed by the vertical wells at the front of the program.

Blue’s plan going forward is to start and continue the dewatering process and establish the maximum gas flow rate for the wells and seams over the coming months.

This is expected to yield peak gas rates from which economic models can be refined to optimize development plans.

Regional seismic acquisition

Blue is progressing an environmental management plan (EMP) for the acquisition of 2D regional seismic in exploration permits within the Greater McArthur Basin in the Northern Territory.

The EIA will include the results of fieldwork carried out in March that looked at the flora, fauna and access points of potential seismic line locations.

Blue expects to file the EMP in the coming weeks.

The company continues to consult with various Aboriginal land councils, traditional owners, pastoral landowners, government departments and other stakeholders as part of the process to establish a community licence.

This work is required under the area’s new exploration activity approval process.