Stimulation activities on Horseshoe #4 successfully completed on time/on budget.
Horseshoe #4 proceeding to flowback, clean-up and re-connection to the gas gathering network.
Stimulation equipment relocated to Horseshoe #2 to commence 2-stage stimulation programme.
Stimulation programme expected to be completed and all wells online by the end of November

Armour Energy provides an update on the Surat 2020 Work Program which is being conducted on its 100% owned and operated Kincora Gas Project.

Stimulation activities on Horseshoe #4 successfully completed – on time and on budget Armour has successfully completed the stimulation activities on the Horseshoe #4 well, a single-stage stimulation of the basal Rewan sandstone over a 4-metre interval between 1936 metres to 1940 metres. The programme was successfully completed utilizing approximately 82,000 lbs of proppant into the target zone.

Prior to conducting the stimulation, the Company conducted a DFIT test (diagnostic fracture injection test) and to improve formation contact for the stimulation, reperforated the target interval. A postreperforation DFIT was conducted and the targeted basal Rewan interval demonstrated a significant improvement in stimulation conditions. On Sunday, 1 November, the target interval was then stimulated exactly as planned with all proppant placed. Within a couple of hours after the completion of the stimulation, wellhead pressure was recorded at 2000 PSI, which is an encouraging sign that the target basal Rewan interval is likely to produce at the forecasted production estimate.

A production string will now be installed, and the Horseshoe #4 well will commence the clean-up and flowback phase prior to returning to sales gas production. The Company will provide further information on the well flow rate and the outcome of the Horseshoe #4 stimulation programme.

Overview of Horseshoe #2 stimulation programme

The Horseshoe #2 well was originally drilled by Oil Company of Australia in 2002 targeting the intra Wallabella and upper Tinowon sandstone, with the basal Rewan as a secondary target. The upper Tinowon was absent but the intra Wallabella sandstone was gas saturated, connected, and put on production in 2009. The basal Rewan was considered prospective at the time, but not completed in the Horseshoe #2 well.

The Horseshoe #2 well is connected to the Horseshoe gathering system which is connected by an 8km flow line to the Myall Creek Compressor Station.

Since the Horseshoe #2 well was brought into production, the Company has identified significant wellbore damage including fill in the open hole section, which inhibits the potential for higher gas flow rates. The open hole section over the intra Wallabella was recently and successfully cased and cemented in place. It is expected through recompletion and stimulation of these low permeable reservoirs, that production can be significantly enhanced, from both the intra Wallabella and basal Rewan formations.

KeyFacts Energy: Armour Energy Australia country profile