Daydream-2 Well To Spud In October

Elixir Energy Limited(“Elixir” or the “Company”) is pleased to provide an update on its 100% owned Grandis Gas Project located in the Taroom Trough very close to the Wallumbilla gas hub in Queensland.

HIGHLIGHTS

• Daydream-2 well due to spud in October 2023
• A key aim of the well is to significantly expand upon existing large contingent resource
• Rig contract executed with global oil field services contractor SLB
• All approvals received to commence civil works

The planned spud date for the Daydream-2 appraisal well is now set for late October this year. The attached presentation provides the background on this.

The Grandis Gas Project has already booked a very material and independently certified 2C contingent resource of 395 billion cubic feet of gas (see ASX announcement of 10 November 2022). A key objective of the Daydream-2 appraisal well is to materially expand this contingent resource.

Elixir has executed a Rig Services Contract with a subsidiary of global oil field services SLB (previously known as Schlumberger). The contract is for the provision of SLB 185, which has recently drilled two highly successful wells in the Taroom Trough for a neighbouring Operator. These were drilled with great efficiency, demonstrating both the well understood nature of the local geology as well as SLB’s world class capabilities.

Elixir has received the necessary landholder and regulatory approvals to commence preparatory civil works in the field. Initial work is expected to commence in late July with water bore drilling. Thereafter the well pad site preparation and upgrading of the access to the well pad will commence in August.

The well will drill to a total depth of ~4,200m, and target the gas saturated Permian section that was proven at Daydream-1, drilled ~5 kilometres to the west of Daydream-2. The well will focus not only on the sandstones in this gas saturated Permian section, but also the gassy coal-seams therein (as per the presentation made at the APPEA Conference and released to the ASX on 17 May 2023).

As noted in Elixir’s ASX announcement of 17 May 2023, the Federal Government will pay for 43.5% of the total cost of the Daydream-2 well through its R&D Tax Incentive mechanism. Project debt finance is readily available to Elixir, secured only on this R&D grant, if considered advantageous.

Elixir’s Managing Director, Mr Neil Young, said: “We are very pleased to have locked in a rig and a time slot for the drilling of the Daydream-2 appraisal well – and in particular with a rig that has very recently demonstrated its capabilities in the Taroom Trough. I consider this as potentially the most impactful well in Elixir’s history – as in the success case it will materially increase the Company’s contingent resources - in a great location which can readily access both domestic and international gas markets”.

Click here for the full ASX Release

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