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Coal depth now 40 metres in Ohai OM-4 CSG well; L&M confident of commercial gas production
14 May 2010 - Logging of L&M Petroleum’s OM-4 coal seam gas well at Ohai in western Southland has increased the depth of coal seams intersected to 40 m from the original 29 m originally reported.
Sources: L&M Petroleum and Lindsay Clark
Geoffrey Loudon chairman of L&M Petroleum said the company is confident that OM-4 will substantially increase 3P reserves at Ohai and also opportunities to commercialise the gas.
The company already held 173 PJ of certified 3P reserves at Ohai which was equal to about one year’s gas consumption for the whole country.
The pilot testing phase to start later this year aims to upgrade reserve status to 2P from its current 3P status and this in turn will lead to being able to negotiate supply contracts.
Mr Loudon said the company plans to establish its first 2P reserves by the end of 2010.
“Early enquiries are being received from potential users and as long as we can deliver 2P reserves I am confident that commercial development of the gas will follow”, Mr Loudon said.
Electric logging of OM-4 after well completion gave a much more accurate picture of the coal seams. Gas desorption details will not be available for several weeks.
The earlier report said that the gassy coal from the Cretaceous Morley coal measures were over 750 m downhole and twice as thick as the Beaumont coal measures found at around 600 m deep.
Gas had a bright future in New Zealand, Mr Loudon said. The gas price of around $7 a gigajoule was about double East Coast Australia gas prices.
“These trends are set to continue and bode well for our acquired reserves and continuing exploration”, he said.
Related links
Request copy of Crown Minerals Annual Report - Coal seam gas - 2010 NZ Petroleum Conference
