Strike nudges gas taps wider at Jaws-1

Strike Energy continues to gradually increase gas flow at its Jaws-1 super-deep coal seam gas well in the Cooper Basin, South Australia, as more coal transitions from water to gas production.

Bottom hole pressure has now reached 250 pounds per square inch, or “psi”, down from the 425psi recorded a month ago as the company continues to draw the well towards desorption.

Pump rates have been set to maintain this pressure to allow the desorption front to gradually spread outwards into the rest of the reservoir.

Management said the current water production rates of 450 barrels per day show continuing strong reservoir performance.

Water production is expected to decline over time as more coal shifts into gas production.

The super-deep, horizontal Jaws-1 well at Strike’s 66.67%-owned Southern Cooper Basin gas project is designed to develop gas flows from what would be Australia’s deepest commercial coal seam gas deposit.

Once gas desorption is achieved, the company should be able to book a reserve that would set the stage for moving the project into development.

Strike has no shortage of gas buyers should Jaws-1 prove to be a commercial well.

Energy advisory firm EnergyQuest estimated that gas production in New South Wales, Victoria, South Australia and Tasmania would be less than demand by 2022.

This would force the eastern states to secure more gas from Queensland, which could push wholesale prices up to between $10 and $13 per gigajoule as domestic demand jostles with liquefied natural gas exports.