Glenaras Gas Project

Summary

Galilee is the 100% equity holder and operator of the Glenaras Gas Project, which is located in ATP 2019 (formerly ATP 529) in the central reaches of the Galilee Basin in central Queensland.

The Galilee Basin is a vast, sedimentary basin covering approximately 247,000 sq.km and contains globally relevant volumes of coal in the Late Permian Betts Creek Beds and Early Permian Aramac Coal Measures.  After more than 50 years of exploration, the Glenaras area has been definitively established as the most prospective coal seam region across the entire basin, with ATP 2019’s extensive 3,247 sq.km covering the entire Glenaras coal seam gas “sweetspot”.

Wide reaching exploration and appraisal activity across ATP 2019, amounting to over $150 million of expenditure, has comprised more than 20 exploration wells and coreholes, over 700km of fully reprocessed 2D seismic and three multi-well production pilots with a detailed 3D seismic survey over the currently operational Glenaras Multi-Well Pilot.  The results of this high-integrity and detailed data acquisition programme support the independent estimation and certification of a significant 3C Contingent Resource of 5,314 PJ of recoverable coal seam gas.  This considerable volume of gas represents one of the largest, uncontracted gas resources on the east coast of Australia and with no domestic reservation constraints, the Glenaras Gas Project is well positioned to mature towards development and supply into both the tight domestic gas market and the lucrative LNG export market.

Geology

The Late Permian Betts Creek Beds are the prospective coal measures in the Glenaras Gas Project with multiple, stacked coal seams present at approximately 1,000m depth.  The Glenaras coal seam gas “sweetspot” has been clearly defined as the only area within the Galilee Basin that has all of the combined geological properties necessary for commercial coal seam gas development including elevated net coal thicknesses, gas contents, gas saturations and permeabilities.

Glenaras Multi-Well Production Pilot

To mature the considerable coal seam gas Contingent Resource in ATP 2019 to Reserves, the Glenaras Multi-Well Pilot has been built and commissioned with the exclusive objective of establishing commercial rates of gas production from the Betts Creek Beds.  Success at the pilot will support a material, maiden Reserves booking and underpin full field development and gas sales agreements.

The Glenaras Multi-Well Pilot is an innovative, highly technological design that integrates both horizontal and vertical wells to dewater and depressurise the coal seams of the Betts Creek Beds.  As the water is removed from the coal seams, the internal reservoir pressure decreases until reaching critical desorption pressure, when the internally stored gas is released in larger quantities.

Recently acquired pressure data in Glenaras 17A has confirmed that the coal seams in the Betts Creek Beds have not yet reached critical desorption pressure, but are quickly approaching that crucial threshold.  Confirmation of this important data validates why the pilot’s gas production rates have not yet started to rise consistently away from the depleting water rates.  However, in terms of encouraging signs, recent production trends are exhibiting increasing gas to water production, which can only be due to increasing levels of gas entering the system via early stage desorption as the coals approach their critical desorption pressures.

There is no doubt that the combined challenges of the gas under saturated state of the Betts Creek Beds coals and the connection of the coals to adjacent water-bearing sands, has resulted in longer than expected dewatering.  However, this very recent data from Glenaras 17A confirms that the Glenaras Pilot with its current configuration of wells and artificial lift, is successfully achieving its purpose of depressurising the Betts Creek Beds coals.  It is this validation of design and performance that supports the very high confidence in the Glenaras Pilot verging on increased gas production rates as the final requirement to proving commerciality of the project.

Access To Market

A clear pathway to market for the Glenaras Gas Project’s potential gas Reserves has been determined via a non-binding Memorandum of Understanding with Australia’s largest pipeline builder, the APA Group (19th September 2022).

This agreement supports APA undertaking the possible construction of an adequately sized pipeline to export future gas production from Glenaras and tie directly into the South West Queensland Pipeline at Cooladdi, which is approximately 420km south.  This tie-in is advantageous as it allows gas to reach all domestic markest on the east coast of Australia and gain access to the highly lucrative LNG export market via Gladstone.

This agreement forms a cornerstone for commercialisation of the project and provides increased confidence that success at the Glenaras Multi-Well Project will be rapidly followed by the securing of gas sales agreements as part of the future field development.