Energy

Warrego Energy confirms more gas underground at Perth Basin gasfield

Fri 01 Jul 22, 4:52pm (AEST)
Drilling - Oil or gas drilling rig
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Key Points

  • Warrego Energy’s WE3 well at the WA Erregulla gas field has confirmed gas deposits further north than thought
  • Drill hit a 60m gas column with 38m targeted for easy production and extraction
  • Company to update reserves ahead of planned production start in 2023

Warrego Energy (ASX:WGO) shares have jumped over 9% as the company reveals its Perth Basin gasfield extends further north than thought.

Exploratory drills sniffing around the outskirts of the project for gas deposits have been successful. 

The company is reporting a 38m gas column struck on site within a larger 60m drill run targeting the Kingia Sandstones. 

Production at the Eregulla gas field (which contains Kingia) is set to begin next year. 

Warrego and Strike to update reserve 

Warrego and its 50/50 JV partner Strike Energy (ASX:STX) are to engage with the energy standards body NSAI to legitimise updated gas reserve estimates.

The partnership will use results from the recently spud WE3 well, from which today’s news is borne. 

How is Warrego going? 

At the end of third quarter (Q3) of FY22, Warrego had $36.1m cash in hand and a quarterly opex spend of $216k. 

Allover opex spend for the first three quarters of FY22 sits at $2.54m. 

With WE3 spud in Q4 FY22, it is likely opex spend will reflect a higher value in full year results. 

The company has a market cap of $146.7m; year to date (YTD) performance is up 9.09%. 

Warrego's three month chart compared to the energy index (XEJ) shows the clear relationship between both products
Warrego's three month chart compared to the energy index (XEJ) shows the clear relationship between both products

 

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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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