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ADX flags February test of Anshof-3 oil and gas discovery

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Running wireline operations on the Anshof-3 well.
Camera IconRunning wireline operations on the Anshof-3 well. Credit: File

Europe-based oil and gas producer ADX Energy is planning a production test in February of its Austrian Anshof-3 oil and gas discovery. The company is demobilising it’s contracted RED E-200 drilling rig after running and cementing the final seven inch section of drill casing. The well yielded three oil and gas reservoirs with two potentially being productive according to ADX.

In a final drilling report the company said operations on its Anshof-3 exploration well have been completed and the rig was released recently after logging and casing to the total depth of 2499 metres.

Previous data from electric logs suggest the well’s primary Eocene oil target has a productive zone of 2.5 to 4 metres from a gross interval of 6m according to ADX. Test results also interpreted 14m of gas pay zones from a 20m gross interval in the laminated Miocene reservoirs.

ADX said it will initially production test the well by moving the oil into storage tanks for clean up and then export via adjacent production facilities and siphon the gas into pipelines that are situated only 50 metres away.

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The company said it will test the well using a specialised, smaller and more cost-effective workover rig with much of the required equipment and services available from operations at its Gaiselberg and Zistersdorf fields.

A deal has also been struck between ADX and energy distributor RAG E&P to tie into existing oil and gas gathering, processing and storage facilities that are connected to Austria’s oil and gas infrastructure network.

The work at the Anshof 3 well comes a mere 12 months after ADX received the green-light for its exploration permit - an impressive accomplishment in a sector that can often take many years to achieve the same milestone.

According to management, whilst the productive zones within the Eocene oil reservoir did not match the thickness of pre-drilling expectations, the company will now seek to exploit the expected thicker zones to the east in order to fully realise the potential of its Anshof discovery.

The oily Eocene reservoirs provide the most substantial reserves and value potential from the Anshof discovery according to ADX whilst the shallow gassy Miocene sands could potentially yield substantial near-term cashflows given the currently high gas prices in Europe.

Gas producers in the US are lucky to get US$7 per million cubic feet, or “mcf” of gas whilst in Europe, gas can fetch up to US$35 / mcf.

If next month’s well tests are successful for ADX, the company should be able to garner some solid momentum. If it can book some positive earnings in its upcoming quarterly reports in parallel with its plans to further penetrate into the lucrative eastern sections of the Anshof formations, the ASX listed company could be in for an interesting year ahead.

Is your ASX-listed company doing something interesting? Contact: matt.birney@wanews.com.au

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