Perth Basin gas market continues to boom as Talon mints Walyering reserves

Thu 21 Jul 22, 12:34pm (AEST)
This article was written in collaboration with Talon Energy
TPD - Walyering 5 Gas Flare
Source: Talon Energy

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Key Points

  • Talon Energy, overlooked by investors in the ongoing energy rally, looks set to bring its flagship Perth Basin project online
  • The 2 well Walyering project has today unveiled independently certified gas reserves of 54.2PJ (2P)
  • Talon should benefit from the current focus on domestic energy security within Australia

Talon Energy (ASX:TPD) has unveiled gas reserves for its WA Walyering Gas Field development.

The Walyering discovery is known as Jurassic wet gas, meaning it will produce associated condensate (a light oil) with gas. 

Independently certified from RISC, the Walyering field now boasts 2P gas estimate of 54.2PJ (or roughly 48.3 Bcf adjusted and converted for those who work in imperial), and 550,000 barrels of condensate, representing the newest commercial gas field discovery in the middle of Australia’s ongoing gas crisis. 

In oil and gas lingo, 2P refers to “probable” reserves, indicating the mid-range estimate of commercial oil and gas reserves that are economically recoverable and are justified for development. 

This is huge, given that Talon, with a 45% stake in the project, currently has a market cap around AUD$50m. 

This reserves booking is a major milestone for the project and presumably one of the last steps before Talon can take a Final Investment Decision (FID) to develop the Walyering Project in the Perth Basin.

When Talon takes FID, it’s all lights go for Talon.

High quality gas on-site easily extractable 

The amount of gas in the ground is not the only upside to today’s news. 

Project geos note high quality gas with minimal impurities and surrounded by geology with desirable permeability. 

The project’s proximity to pipeline infrastructure will likely allow for a relatively low-cost production budget in bringing online one WA’s best kept energy secrets.

Plant underway and busy year ahead 

Currently, Talon is finalising the engineering work to construct an on-site processing and production plant that will ready the Walyering field for sales. 

Given the current energy market in Australia, emphasis on domestic energy security, and the existing gas pipeline infrastructure in WA, it is apparent local offtake will be no problem for Talon. 

Of most interest to investors is that Talon believes a plant could be up and running by Q1 2023. 

TPD - Walyering 5 Project
Walyering Project located in the Perth Basin

Condor Prospect

In the background, Talon has another Jurassic wet gas prospect in the Perth Basin. Talon has a binding agreement with Macallum Group for 100% assignment of permit blocks 7977, 8049 and 8121 along with SPA 0081 (“Muchea” Project). 

This prospect has a sizeable contingent resource of 2U 408 Bcf (net to Talon) and like Walyering is also adjacent to pipeline infrastructure. 

The prospect is looking to have an increased chance of commerciality based on the success at Walyering. 

And don’t forget Mongolia 

Partnering with TMK Energy (ASX:TMK) in the South Gobi region of Mongolia, Talon Energy also holds a stake in the promising Gurvantes XXXV CSG project. 

So far, the partnership has spud three wells within the South Gobi Gurvantes XXXV project envelope.

Every single well to date has hit thick bodies of free-moving gas bearing coal which will likely lead to a pilot project in the next 12 months.

DISCLAIMER: Market Index helps small-cap ASX listed companies connect with Australian investors through clear and concise articles on key developments. Talon Energy Ltd was a client at the time of publishing. All coverage contains factual information only and should not be interpreted as an opinion or financial advice. Consider consulting a qualified financial adviser before making an investment decision.

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Written By

Jonathon Davidson

Finance Writer

Jonathon is a journalism graduate and avid market watcher with exposure to governance, NGO and mining environments. He was most recently hired as an oil and gas specialist for a trade publication. Email Jon at [email protected].

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