Blue Energy enters 2024 debt-free and eyeing northern Australia’s gas frontier

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By Colin Hay - 
Blue Energy BLU ASX oil gas Sapphire Queensland Northern Territory

Blue Energy (ASX: BLU) is entering 2024 free of debt and with a cash balance of $6.65 million and a range of opportunities to progress various gas projects in northern Australia.

An immediate focus is the Sapphire pilot well production test program, which the company is preparing to resume following the completion of maintenance work on a hydraulic pumping unit.

This maintenance work is almost complete with the Sapphire 5V pilot expected to be restarted from early February.

In the interim period, Sapphire 6 L3 and L4 laterals have been flaring gas at low rates.

These wells are only producing from the upper two seams of the pilot in the Rangal and Fort Cooper coal measures.

The company is also currently considering incorporating a remedial program at Sapphire after test results identified potential skin damage on the pilot project’s lateral wells.

The Sapphire pilot project is located immediately adjacent to the Moranbah gas project (MGP), a producing gas field recently acquired by Queensland Pacific Minerals Energy (QPME).

Blue Energy has an existing non-binding memorandum of understanding (MoU) to supply gas to QPM’s (parent entity to QPME) proposed nickel refinery in Townsville.

Blue and QPME have also executed a non-binding MoU to supply pilot gas to the MGP from the Sapphire pilot via a proposed pipeline from Sapphire to the Node 3 compressor station within the MGP.

Seismic go-ahead

Elsewhere, Blue has been granted approval of its environmental management plan for the acquisition of two-dimensional (2D) regional seismic data in exploration permits (EPs) 205 and 207 in the Northern Territory.

The approval process took 11 months and follows environmental work and indigenous sacred site surveys in 2022.

Blue is continuing to undertake land access agreement negotiation with landholders.

Due to the lengthy delays in gaining approvals, Blue has been granted a suspension of work program and extension of permit term for EPs 200, 205 and 207.

After consideration of Blue Energy’s submission for a suspension and extension of work program and permit terms for the three Wiso Basin permits, the NT Minister for Industry, Tourism and Trade has granted a 12-month extension.

Wiso basin boost

The exploration potential of the Wiso Basin area has been boosted by Geoscience Australia’s (GA) acquisition of regional 2D seismic data as part of a national “Exploring for the Future” seismic acquisition program.

With some of the data acquired within Blue’s tenement areas, the company is looking forward to the release of the raw data which is expected to be available in March.

The data was acquired by GA in September 2023 and is of great interest to Blue as it will assist in establishing a regional geological and structural framework in the area where there is currently very little information on hand.