Next Investors logo grey

Update on Project Venus likely to pique investor interest in RLE

Published 18-JUN-2020 14:40 P.M.


3 minute read

Hey! Looks like you have stumbled on the section of our website where we have archived articles from our old business model.

In 2019 the original founding team returned to run Next Investors, we changed our business model to only write about stocks we carefully research and are invested in for the long term.

The below articles were written under our previous business model. We have kept these articles online here for your reference.

Our new mission is to build a high performing ASX micro cap investment portfolio and share our research, analysis and investment strategy with our readers.

Click Here to View Latest Articles

In a much anticipated event, Real Energy Corporation Limited (ASX: RLE), an Australian east coast focused gas company with interests in the Cooper and Surat Basins, will next Tuesday (June 23) provide an update on the 50/50 Joint Venture (Strata X Energy - 50%) Project Venus and the forward work plans for the remainder of calendar year 2020.

Real Energy’s managing director, Scott Brown and executive chairman of Strata-X Energy (ASX:SXA) Ron Prefontaine will expand on Project Venus’ 2020 planned appraisal program which sits within the Surat Walloon CSG (coal seam gas) fairway in the Surat Basin.

As well as outlining plans for Project Venus, both executives will be available for questions, and if you would like to gain an understanding of the venture, this is the link:

By way of background, the program is designed to initially produce gas out of Connor-1 and then prove sustained commercial gas flow rates with the goal of establishing resources and reserves.

Information already to hand includes an independent review of the data within and around the permit as mapped out below.

It contains a certified a Prospective Gas Resource of 658 BCF (694 PJ) gross, 329 BCF (347 PJ) net to Strata-X in the Walloon coal seams in ATP 2051.

02 - RLE.PNG

Real Energy is the administrative and commercial operator while Strata-X, at least for the initial phase to predictable reserves certification, will be the technical operator.

Aligning with Strata-X was an astute decision by Real Energy, as the experienced Prefontaine is the executive chairman of the group.

He was the technical director of Arrow Energy and founding managing director of Bow Energy, two ASX-listed CSG companies that were separately taken over in 2010 and 2011, respectively, for a combined total of approximately $4 billion.

Gas production from Connor-1 could be share price catalyst

There are several previously drilled CSG and conventional wells located within and around ATP-2051, including a fully cored well indicating the upper Walloon coal seams are fully gas saturated.

One of the historic wells in the permit, the Connor-1 well, was drilled immediately adjacent to the core hole, then cased and under-reamed (enlarged beyond the regional drilled size), but it wasn’t properly flow-tested.

The Project Venus JV plans to re-enter the Connor-1 well to reservoir-enhance and flow-test the upper Walloon coals.

Assuming the Connor-1 re-entry flow-test goes to plan, the Project Venus JV initially anticipated drilling two wells offsetting Connor-1 and fully equipping the three wells as a production pilot program.

However, Tuesday’s update will no doubt provide further details regarding this procedure.

It is anticipated that the pilot program will include long term flow-testing of the upper Walloon coals with the objective to prove commercial gas flows rates.

Once commercial gas flow rates are achieved in the pilot program, the Project Venus JV should be positioned to commence progressively converting the 658 BCF (694 PJ) Prospective Gas Resource to reserves, effectively fast-tracking development of the project, thereby offering the potential for early cash flows.

General Information Only

S3 Consortium Pty Ltd (S3, ‘we’, ‘us’, ‘our’) (CAR No. 433913) is a corporate authorised representative of LeMessurier Securities Pty Ltd (AFSL No. 296877). The information contained in this article is general information and is for informational purposes only. Any advice is general advice only. Any advice contained in this article does not constitute personal advice and S3 has not taken into consideration your personal objectives, financial situation or needs. Please seek your own independent professional advice before making any financial investment decision. Those persons acting upon information contained in this article do so entirely at their own risk.

Conflicts of Interest Notice

S3 and its associated entities may hold investments in companies featured in its articles, including through being paid in the securities of the companies we provide commentary on. We disclose the securities held in relation to a particular company that we provide commentary on. Refer to our Disclosure Policy for information on our self-imposed trading blackouts, hold conditions and de-risking (sell conditions) which seek to mitigate against any potential conflicts of interest.

Publication Notice and Disclaimer

The information contained in this article is current as at the publication date. At the time of publishing, the information contained in this article is based on sources which are available in the public domain that we consider to be reliable, and our own analysis of those sources. The views of the author may not reflect the views of the AFSL holder. Any decision by you to purchase securities in the companies featured in this article should be done so after you have sought your own independent professional advice regarding this information and made your own inquiries as to the validity of any information in this article.

Any forward-looking statements contained in this article are not guarantees or predictions of future performance, and involve known and unknown risks, uncertainties and other factors, many of which are beyond our control, and which may cause actual results or performance of companies featured to differ materially from those expressed in the statements contained in this article. S3 cannot and does not give any assurance that the results or performance expressed or implied by any forward-looking statements contained in this article will actually occur and readers are cautioned not to put undue reliance on forward-looking statements.

This article may include references to our past investing performance. Past performance is not a reliable indicator of our future investing performance.