Calima Energy (ASX:CE1) concludes drilling of Gemini #4 well, what’s next?

Image Source: Bantry 10-20 Oil Battery (Source: CE1 update, 8 July)


  • Calima Energy has finalised its four-well drilling program in the Brooks area. Revenue is expected to be recognised partially in July and from August onwards.
  • Rising WTI crude oil prices are expected to render the wells highly economical with very short payback periods.
  • The campaign has been funded through operating cash flows and partly by the National Bank debt facility.
  • The Company has planned to drill three multi-stage fractured horizontal wells in the Thorsby area during the third quarter of 2021.

Calima Energy (ASX:CE1) has announced an exciting update, which aligns well with its guidance of achieving an average daily production of 4,500boe by the end of 2021.

The Company has finished drilling Gemini #4, the fourth well in its latest drilling campaign in the Brooks area.

All four wells have been drilled on the Sunburst formation running through the oil and gas assets of the Company in the Brooks area in Alberta, Canada.  

The drilling rig has been released, and completion works are expected to commence shortly on the Gemini #4 well. Once the well is completed, the gas produced will be tied into a nearby third-party facility, and the liquids produced will be carried by tankers to a Blackspur oil processing facility.

Recent update: Calima Energy (ASX:CE1) shares soar 12.5% on Brooks Sunburst drilling update

Bantry Oil Processing Plant 2-29 (Image source: Company update, 8 July 2021)

Gemini #4 is anticipated to join the production stream by 28 July 2021. The first and the second wells of the Gemini series have already hit the production stage and the third one is expected to be on production by 16th of this month.

The Gemini 1-3 wells were drilled within the existing known reserves in the project area. Gemini #4 is a step-out well, and in case it turns out to be successful, it possesses the potential to contribute new reserves to the P1 and P2 categories.

Read here: Calima Energy (ASX:CE1) lifts guidance on stellar May operational figures

Sunburst wells: Horizontal but economical

The Sunburst wells are conventional, horizontal wells. The pay zone area is kept open, i.e., it is not cased, hence no hydraulic fracturing is required on these wells. This reduces the cost of completion on each well. The average cost of a well on the Sunburst formation comes around C$1 million.

With West Texas Intermediate (WTI) oil prices above US$70/bbl, the 100% payback period is expected to be around five months.

Payout percentage by months (Image source: Company update, 8 July 2021)

Good read: Calima Energy (ASX:CE1) commences 3 well Sunburst drilling campaign at Brooks

CEO and President of Calima Energy Jordan Kevol expressed his pleasure on running the campaign efficiently within the stipulated time and cost.  

We are now preparing for our next drilling program at Thorsby Alberta which is anticipated to commence in late August pending nearby drilling rig scheduling. Three multi-stage fractured horizontal wells are planned for the Thorsby program. Initial production results from the recent Brooks program will become available later this quarter,” Mr Kevol added.

To know more read more: Three Catalysts Enhancing Calima Energy's (ASX:CE1) Upside Potential

The shares of CE1 closed the day’s trade at AU$0.011 on 8 July 2021 with a market cap of AU$113.01 million.  



The content, including but not limited to any articles, news, quotes, information, data, text, reports, ratings, opinions, images, photos, graphics, graphs, charts, animations and video (Content) is a service of Kalkine Media Pty Ltd (Kalkine Media, we or us), ACN 629 651 672 and is available for personal and non-commercial use only. The principal purpose of the Content is to educate and inform. The Content does not contain or imply any recommendation or opinion intended to influence your financial decisions and must not be relied upon by you as such. Some of the Content on this website may be sponsored/non-sponsored, as applicable, but is NOT a solicitation or recommendation to buy, sell or hold the stocks of the company(s) or engage in any investment activity under discussion. Kalkine Media is neither licensed nor qualified to provide investment advice through this platform. Users should make their own enquiries about any investments and Kalkine Media strongly suggests the users to seek advice from a financial adviser, stockbroker or other professional (including taxation and legal advice), as necessary. Kalkine Media hereby disclaims any and all the liabilities to any user for any direct, indirect, implied, punitive, special, incidental or other consequential damages arising from any use of the Content on this website, which is provided without warranties. The views expressed in the Content by the guests, if any, are their own and do not necessarily represent the views or opinions of Kalkine Media. Some of the images/music that may be used on this website are copyright to their respective owner(s). Kalkine Media does not claim ownership of any of the pictures displayed/music used on this website unless stated otherwise. The images/music that may be used on this website are taken from various sources on the internet, including paid subscriptions or are believed to be in public domain. We have used reasonable efforts to accredit the source wherever it was indicated as or found to be necessary.