Santos has talked up the early results from fracking in the Beetaloo with the release of its annual report today.
The energy company told investors the "successful stimulation of the Tanumbrini-1 well" east of Daly Waters had encouraged the company to continue with the drilling of two more wells after this wet season.
The success with a four-stage stimulation (fracking) program in the Middle Velkerri shales produced gas flow rates of 1.2 million cubic feet per day had "exceeded initial expectations".
The Tanumbrini-1 well had been previously drilled vertically almost four kilometres deep.
" ...with the approval of environmental plans by the Northern Territory government, we now expect to drill two appraisal wells in 2020 following the wet season," the company said today.
"The McArthur Basin has significant gas resources and has the potential to provide feed gas to support future backfill and/or expansion opportunities through Darwin LNG."
Preliminary gas composition analysis from that first fracking test indicated 91% methane, less than 5% total inert content and 3% ethane.
Santos expects to commence drilling in the first half of 2020 followed by multistage stimulation of two horizontal wells: Tanumbirini-2H and Inacumba-1H.
The company said natural gas has a key role to play in a lower carbon future as it produces 50% less greenhouse gas emissions than coal when used to generate electricity, can significantly improve air quality and is the perfect partner for renewable energy sources.
Prime Minister Scott Morrison has also pointed to the use of gas as a "transition fuel" between coal and renewables as a key to the future energy needs of Australia.
Origin Energy and Falcon Oil and Gas are also drilling in the NT to test claims of a giant gas reservoir in Beetaloo, south-east of Katherine.
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