Two sites have been chosen after seismic for drilling in PEL 6. ESG says:
"To complete the first stage farmin work programme, one further corehole is to be drilled in PEL 6. Should a second corehole be completed in PEL 6, ESG will earn an additional 25% (net 75%)interest in the coal seam gas rights of this licence. Initial interpretation of the seismic data has provided support for the pre-seismic geologic model which predicted the potential for Permian coal at prospective depths for CSG on the eastern side of PEL 6. These coals, if present, are the lateral equivalents of the the Gunnedah Basin coals that are under extensive investigation to the south in New South Wales. In addition two coreholes are planned for the second half of 2009 targeting both the Moolayember Formation and Permian section in PEL6.
An ESG internal estimate indicates that the prospects to be investigated as part of the farm-in could contain a high-side prospective gas resource of 3,500 Bcf."
That says to me that Bohena and Hoskisson coals (and perhaps Namoi coals) are expected in PEL 6 (and in PEL 427 from my reading of their prospect maps). They have been successful in confirming their model by drilling everywhere else .. so you would have high confidence that this drilling will be successful. The drilling earlier this year in adjacent PEL 427 on the Moree prospect confirmed that the coals in the area are gassy.
Would like a start date!
H
OIP Price at posting:
15.0¢ Sentiment: LT Buy Disclosure: Held
