Raven begins critical gas flow testing at Tulainyo

Published at Feb 22, 2018, in Small Caps

Energy junior, Raven Energy (ASX:REL), has today updated the market on its progress at the Tulainyo Gas Discovery in northern California’s prolific Sacramento Basin.

A gas flow test program is expected to begin within the week. Test equipment is on site, and two tests are planned involving multiple potential conventional sandstone gas reservoirs.

REL, which is capped at A$19.23 million, has a 20 per cent stake in the project via its investment in Gas Fields LLC.

As REL announced previously, the Tulainyo 2-7 well was drilled to the planned total depth of 5,710 feet (1,740 metres). This represented a significant engineering achievement by the Tulainyo joint venture due to the challenging over–pressured geological conditions within the very large anticlinal structure.

Post-well analysis indicates multiple stacked sandstone units, varying as expected in thickness and quality, that are all gas saturated.

A two-stage test program will now be carried out, with perforations into the selected reservoir intervals using Tubing Conveyed Perforating Equipment or TCPs. Testing will commence across a zone lower in the well with perforations across at least three separate sands with varying, interpreted reservoir quality. Once sufficient data has been captured from the first test, a removable bridge plug will be set to isolate the lower test zone, and a second test will be conducted over a shallower, thicker sand package.

Overall, the program is expected to take around one month to complete. REL will release further information to the market once test results are clarified.

Yet REL remains a speculative stock and investors and investors should take a cautious approach to any investment decision made with regard to this stock.

Commenting on the test program, John Begg from Gas Fields said: “Our post-drill analysis indicated potential net gas pay of 56 metres (183 feet) from within a gross reservoir section of up to 118 metres (386 feet). We are now, after extensive engineering work and pre-planning, ready to flow test a representative suite of these sands.

“The goal is to prove these sandstone reservoirs have sufficient quality to support commercial scale flows of natural gas. Gas Fields believes there is an excellent chance of achieving this objective across a two-stage test program,” Begg said.

The Tulainyo Project is situated around 120 kilometres northeast of Sacramento. It is held under leases covering some 40,000 net acres (152 square kilometres), and is positioned just eight kilometres from a major gas transport trunkline that supplies gas from Canada into the expansive Californian domestic market.

California only produces a sixth of its annual gas demand, and is expected to import 98 per cent of its natural gas requirements by 2025.

The Tulainyo JV includes the project operator, California Resources Production Corporation (NYSE:CRC), one of California’s largest oil and gas producers, as well as Cirque Resources LP, a private company based in Denver, Colorado.

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