Real Energy Progresses Development of Tamarama Project; Share Price up 9%
Real Energy anticipates this stimulation program to be completed in 2 weeks.
Real Energy Corporation Limited (ASX:RLE) announced that the company has commenced its ‘five-stage fracture stimulation’ program for the Tamarama-1 well, located in the Cooper Basin, Queensland.
All the necessary tests of high pressure wellhead and fracture stimulation equipment have been successfully completed during the weekend. The first of the five stage fracture stimulation program is scheduled to commence today.
Halliburton Australia, the main contractor for the project, will undertake operations to test the Toolachee and Patchawarra formations, both well known for holding and producing gas.
The company states that demand for natural gas is growing across the Eastern States of Australia, and it is well positioned to exploit its 100%-owned acreage in the Cooper Basin, the country’s premier onshore oil and gas province.
Real Energy also states that the fracture stimulation represents a substantial opportunity for the company to unlock the value of its portfolio in the Cooper Basin. Total mean gas in the area is estimated to be around 13.76 trillion cubic feet (TCF) along with a maiden 3C gas resource of 672 billion cubic feet (BCF).
The company anticipates this stimulation program to be completed in 2 weeks.
Real Energy has $10.1 Million in Cash
As at 31 March 2016, Real Energy had $10.1 million in cash. During the March Quarter, the company spent $508,000 on exploration and development operations. The company also completed a Diagnostic Fracture Injection Test (DFIT) program in the Tamarama well and the results for the closure pressures and reservoir data of the frac model were in line with expectations.
RLE has risen 9.1% since the announcement and was last traded at $0.12 (as at 10:40 am (AEST)).
Author: Kaivalya Kandarpa
May 23, 2016
Kaivalya is an equity analyst and a client advisor at Wise-owl. She specialises in fundamental and technical analysis for large and mid-cap companies. Having completed her bachelor's degree in Business Administration majoring in Finance, Kaivalya has a comprehensive understanding of international stock market movements. She tracks local and overseas markets and compiles analytical reports for various industries.