One of the energy companies drilling in the Beetaloo for onshore shale gas has excited the share market today by announcing a substantial find.
Junior gas explorer Empire Energy told the stock exchange today it had discovered what is believes it is a big reservoir of liquids rich gas at its Carpentaria-1 well site about 85km south-west of Borroloola.
The gas was found shallower than expected and across a layer of shale almost a kilometre thick.
Carpentaria-1 is only the second well drilled in the Beetaloo Sub-Basin since the lifting of the fracking moratorium in 2018, after Origin Energy's Kyalla-117 horizontal well.
Now the market is waiting for Origin to report on what it found in fracking tests from its Kyalla-117 well, that report is expected soon.
"The proportion of liquids-rich gas intersected in the Valkerri (shale) dramatically exceeds that of analogue wells previously drilled across the Beetaloo basin and materially exceeds Empire's pre-drill expectations," Empire Energy said.
Energy companies have long believed the Beetaloo was rich in gas but have been hoping to find the more expensive liquids-rich gas to make commercialisation of the find more economic.
The companies have been at pains to say liquids-rich is not the same as oil.
"Liquids rich gas' is gas that presents in the form of a liquid as it comes to the surface as pressure and temp changes - not oil," Origin Energy said last year.
"The liquids are the next step up in the molecule chain - ethane and propane which is LPG or bottled gas; butane which is used as fuel in lighters or condensate.
"As the gas comes towards the surface the pressure and temperature changes. The heavier molecules above methane can either stay as gas or begin to form a liquid (hence the term 'liquids rich natural gas'), which is clear and not black like oil.
"A simple analogy would be a hot shower, the steam (gas) condenses to water (liquids) as it cools.
"Gas being produced in off-shore fields and processed in the NT are liquids rich."
Empire Energy managing director Alex Underwood said today they expected to find a drier gas.
"The presence of high levels of associated gas gas liquids in the target shales is encouraging for future commercial production scenarios because high-value liquids from produced gas can significantly enhance economics.," Mr Underwood.
Empire said it hit the shale at 833 metres and found the layer was almost a kilometre thick.
As a result, it may not have to drill any deeper.
Several companies have resumed exploration in the past month after the August election results became clear.
An easing of pandemic restrictions and the haste to do as much as possible before the wet season kicks in has prompted the rush of activity as has the "positive" election result.
The market has already been alerted to the possibility of the Beetaloo by the Prime Minister Scott Morrison's recent announcement the Beetaloo's development was to be fast tracked.
The explorers like Empire, Origin and Santos are looking for gas in two shale layers, the more prospective Kyalla and the Velkerri which Empire has intersected.
Until Empire's find, it had been thought the Kyalla shales more likely to be liquids rich.
Empire said it would now prepare the well for fracking tests and a flow testing program early next year.
While you're with us, you can now receive updates straight to your inbox each Friday at 6am from the Katherine Times. To make sure you're up to date with all the news, sign up here.