Emerging domestic natural gas and helium producer Renergen over the weekend recorded short-term venting of pressurised gas in the drilling mud while still in the Karoo Formation, prior to intersecting the targeted sandstone deposit at its Virginia gas project.
Drilling out of the casing shoe started on November 29 and the well is currently drilling ahead horizontally in Karoo Formation.
Shortly after drilling out of the casing shoe, while still in the Karoo Formation, shows of gas were recorded in the drilling mud followed by a short-term venting of pressurised gas.
The findings were recorded in the company’s current horizontal drilling operations targeting the previously announced 90 km2 sandstone unit within the company’s production right area in the Free State.
In a cautionary announcement issued early on Monday morning, the company advised that evaluation of the drilling in the horizontal sandstone section, once penetrated, would be reported “as soon as meaningful results are available”.
Until such time, Renergen would be unable to provide any further guidance.
The well was drilled to a depth of 254 m in the Karoo Formation overlying the target sandstone, and casing has been set in anticipation of penetrating the sandstone a short distance laterally from the casing shoe.
Given the high pressures and concentration of helium encountered in the original discovery well, Renergen confirmed on Monday that it “has taken all necessary measures to ensure the integrity of the well” and noted that it has “successfully confirmed the integrity of the casing cementation”.
The horizontal well has been designed to evaluate the extent and composition of any gas in this sandstone unit, where a previous vertical well encountered over-pressured natural gas with an 11% concentration of helium.
A successful horizontal well, establishing material extent and sustainable commercial gas flow rates for this target reservoir, would underpin a significant expansion (dubbed Phase II) of the Virginia gas project, which is currently being developed.