Omega Oil and Gas advances Taroom Trough appraisal with positive Canyon-2 results

Omega Oil and Gas (ASX: OMA) has strengthened its belief that Queensland’s Taroom Trough has the potential to be a significant contributor to the east coast gas market.

Omega recently flowed both oil and natural gas to surface in its successful Canyon-1H fracture stimulation and flowback program and has now received further positive results from an appraisal of the extensive Canyon project area.

The company is now accelerating its appraisal of the Canyon project area, with a focus on acquiring and evaluating an extensive suite of subsurface data to determine a future appraisal drilling program designed to convert the existing contingent resource at Canyon to reserves.

Discussions underway

As part of its strategy to bring Canyon to commercialisation, Omega is now engaging with potential partners to assist with funding the appraisal and development of the Taroom Trough assets.

Chief executive officer Trevor Brown said the company is also investigating potential commercial pathways for near-term and long-term development of its oil and gas assets.

Notable recent results have found that oil and gas zones Omega identified in Canyon-1 and tested in Canyon-1H are also present 15.7 kilometres away in Canyon-2, where the equivalent sandstone pay interval is thicker and of higher quality.

“The Canyon-2 cased hole logs have provided confirmation of an extensive oil and gas province with encouraging signs pointing toward commerciality,” Mr Brown said.

DFIT program

The company has now commenced a diagnostic fracture injection test (DFIT) program at Canyon-2 and will conduct a series of tests over coming months in selected zones throughout the prospective Permian interval.

The DFIT program will gather diagnostic geomechanical data and measure the level of over-pressure in multiple zones that will allow characterisation of changes with depth and inform zonal correlations across the project area.

“The Canyon-2 DFIT program will add to our understanding of stacked pay potential and allow important regional correlations – further de-risking the play,” Mr Brown said.

“Omega’s cash position is strong and encouraging discussions are ongoing with potential future partners.”