Vintage Energy Limited (ASX: VEN) is involved in the energy sector. It is predominately engaged in the exploration, acquisition and development of gas, oil and other energy production assets. Vintage holds the interest in Otway Basin, Galilee Basin and Bonaparte Basin located across Australia.
An operational update was provided by Comet Ridge Limited (ASX: COI) with respect to the Galilee Deeps JV and the 2019 Albany drilling programme. The heavy rainfall during February and March, which was not seasonal, led to the suspension of well site construction activity. In parallel, the drilling rig’s mobilisation was delayed due to the heavy rainfall.
The construction activities were resumed on 7th May 2019, and the work is expected to be finalised before the end of this week. The heavy rainfall impacted the gravel/dirt access roads into the Albany project. The roads are now almost sufficiently dry, which will allow the movement of the rig equipment.
Upon favourable conditions, the Ensign Rig 932 will first mobilise from Moomba (current location) to the Albany 2 well site. It is expected that the rig move will begin in early to mid-June, provided no further rainfall occurs. The expected time for Albany 2 pad to get ready for initial drilling is two weeks.
The Ensign 932 rig will drill the Albany 2 well (anticipated spud date of late June), followed by the side-track of the Albany 1 well. Albany 1 was successful in flowing gas, without stimulation, at 230,000 scfd from only the top 10% of the 130-metre target reservoir. Albany-2 will be cored to better understand the reservoir properties to optimise the drilling and stimulation approach so that the ultimate gas flowing from the Albany Field can be enhanced.
The rig will be moved to the Albany 1 location post drilling of the Albany 2. The well drilled in mid- 2,018 to 2,595 metres, will be re-entered and side-tracked, to drill the entire Lake Galilee Sandstone sequence and run casing for future stimulation.
The planning preparations for the stimulation programme for Albany 1 and Albany 2 are underway. Condor Energy Services Ltd has been selected as the preferred provider of the stimulation services, which will include pressure pumping, wireline services and coiled tubing.
Although rain has delayed the program, it has provided welcome relief to drought-stricken landholders in the area. Vintage has 15 per cent of stake of the Galilee Basin Deeps Joint Venture and Comet Ridge currently holds 85 per cent stake. The equity level will increase to 30% once the Stage 2 farm-in funding obligations relating to completed Koburra 2D seismic program and the drilling of Albany 2 and Albany 1/ST1 are completed.
The stock of Vintage Energy Limited is currently trading at $0.100 (AEST 02:32 PM, 28th May 2019) down 16.667% during the day’s trade, with a market cap of $31.99 million. It has yielded a negative YTD return of 27.27% and exhibited negative returns of 25.0% and 11.11% over the three months and one-month period, respectively. Its 52-week high price stands at $0.245, with an average trading volume of 203,110.
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