In what has been described as possibly the most significant news since Vintage Energy (ASX: VEN) listed, the oil and gas explorer has announced a large upgrade to the gas reserves for its Vali field in the Cooper Basin.
The company today revealed independent evaluation has tripled the field’s gross 2P reserves from 30.3 billion cubic feet of gas to 92 Bcf. The new estimate includes the addition of reserves from the Toolachee formation as well as an increase to reserves from the Patchawarra formation.
Vintage managing director Neil Gibbins said the revised booking is a “major boost” for the company.
“This material increase in reserves significantly enhances the company’s value as we transition towards becoming a domestic east coast gas producer,” he said.
“We now have independent confirmation that reserves for the Vali gas field are far greater than originally booked, enhancing the long-term economic benefit of this field to Vintage and its joint venture partners.”
Mr Gibbins also noted the upgrade is a major positive for gas pre-sale and debt negotiations, which are nearing final stages.
“This is an exciting time for Vintage and its shareholders, as the key requirements for the commencement of production are now falling into place.”
Vintage operates the Vali field in the Queensland permit ATP 2021 with a 50% interest. Its joint venture partners Metgasco (ASX: MEL) and Bridgeport (Cooper Basin) each hold 25%.
Upgrade includes recently drilled appraisal wells
The revised estimate was booked by independent assessors ERC Equipoise and included results from the recently drilled Vali-2 and Vali-3 appraisal wells.
Metgasco managing director Ken Aitken said the outcome validates the decision to drill the wells and confirms the Toolachee reservoir has conventional gas flow potential to supplement the unconventional potential gas productivity in the Patchawarra zone already tested in Vali-1 ST-1.
“This reserves upgrade further validates Metgasco’s ‘string of pearls’ thesis and underpins the planned pivot to a gas producer into the strengthening east coast gas market in mid-2022 calendar year,” he added.
The Vali partners have already awarded a contract to Logicamms to commence detailed engineering for the connection of the Vali gas field to the South Australian Cooper Basin Joint Venture (SACBJV) infrastructure. This work is a crucial step toward first production and cash flow.