State Gas’ Shares Plunged on ASX After Providing Drilling Results of Reid’s Dome Gas Project

  • Jan 21, 2019 AEDT
  • Team Kalkine
State Gas’ Shares Plunged on ASX After Providing Drilling Results of Reid’s Dome Gas Project

State Gas Limited (ASX: GAS) develops conventional gas fields. It operates in the conventional gas projects of Cattle Creek and Reid’s Dome. It is an 80%-owner of these projects located, approximately 50 kilometres from the Queensland Gas Pipeline.

On 21 January 2019, the company presented the outcome of its drilling programs and analysis on Reid’s Dome gas project. The company is currently operating 80% of PL-231; however, it is making a transition to 100% under the terms of the Joint Operating Agreement. It has drilled seventeen wells between the years 1955 and 2018. The gas flows, from the sandstone reservoirs in the Cattle Creek and Reid Dome. The Pipeline  Survey Licence PSL-2028 was granted for a 2-year term from 1 August 2018.

Reid’s Dome was discovered in 1930 when the staff of the Geological Survey of Queensland undertook a geological reconnaissance on the Springsure Anticline. As stated by John. H. Reid of the geological survey of Queensland, Reid is a closed structure of great amplitude in marine and lacustrine sediments of Permian age. Permian Reid's Dome Beds coal measures are extensive throughout the entire PL-231 zone. Nyanda-4 was the first CSG well drilled in the Reid’s Dome.

The State Gas operates successfully with a small team and limited resources and has received initial approaches and interest to progress the Reid’s Dome Gas Project, including partnering and corporate transactions.  The Board seeks to ensure that discussions include all qualified and interested parties.

Significant Coal Seam Gas (CSG) projects were confirmed in Reid’s dome beds in 40.4m of net coal and 25m of carbonaceous shale. Two wells, Primero West-1, and Nyanda-4 were successfully drilled, demonstrating State Gas’ operating ability to undertake a drilling program from new target identification/ inception to completion in under four months.

Primero West-1 is conventional shallow over-pressured gas, located approximately 650 meters southwest of AOE-1 well which was discovered in the year 1955. However, Nyanda-4 is a coal seam gas and a tight gas sand target located 50 meters southwest of Nyanda-1, which was drilled in the year 1987 to test the hydrocarbon potential of the Reid’s Dome Beds. Coal measures, however, were not evaluated in prior wells drilled at Reid’s Dome.

Now let us quickly have a look at the State Gas Limited’s stock performance and the return it has posted over the last few months. The stock is currently trading at a price of $0.830 and declined by almost 12.632% during the day’s trade with a market capitalization of ~$128.07 million. The stock opened at $0.900 with its day high same price and a day’s low price of $0.800. The stock has yielded a YTD return of 33.80% and posted significant returns of 512.90%, 352.38% and 11.11% over the last six months, three months and one-month period, respectively. It has a 52-week high price of $1.050 and a 52-week low of $0.150, with a daily and average trading volume of 44,593 and 197,660, respectively.


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