Thursday, July 12

Comet Ridge targets coal seam gas reserves with Queensland well

Comet Ridge (ASX: COI) is targeting reserves and possible production with the spudding of the Mahalo-3 coal seam gas pilot well in the Bowen Basin, Queensland, with its latest well.

Mahalo-3 well, which is funded by farm-in partner Stanwell Corporation, targets the shallow Bandanna Formation coals in the northern portion of ATP 337P Mahalo about 260 kilometres west of Gladstone.

Under the terms of the Sale and Purchase Option Agreement with Stanwell, Comet Ridge could realise A$1 million in cash for every 1 petajoule of proved and probable gas reserves it has booked at the end of 2013.

This assumes that Stanwell elects to acquire Comet Ridge’s remaining 35% interest in ATP 337P Mahalo. Other partners in the block are Santos (ASX: STO) and Australia Pacific LNG, each of which holds a 30% interest.

Comet Ridge is drilling two four-spot pilots and an additional four core holes this year.

This is part of a pilot project aimed at converting contingent resources of up to 387 petajoules into reserves.

The joint venture may also carry out a second pilot project to expand the reserves base in the block.

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