ABN 61 058 454 569
ICON ENERGY LIMITED
2015 Annual Report
11
Icon Energy’s interest in the Contingent Resources is
35.1%.
The Contingent Resource estimate was evaluated in
accordance with the Petroleum Resources Management
System (
PRMS
) (March 2007).
DeGolyer and MacNaughton evaluated the well results
from recent activities in Etty-1, Hervey-1, Redland-1 and
Geoffrey-1 as well as the historical results from Halifax-1.
The consultant’s utilised core, log and flow test data from
the target intervals in these wells to determine whether a
significant quantity of potentially moveable hydrocarbons
had been penetrated, which is a key requirement for a
discovery under PRMS. The results of this work showed
that the flow rates from all of these wells passed the
discovery test.
In the report, DeGolyer and MacNaughton stated, “when
compared to the flow rates for Halifax-1 (ASX Release 26
August 2013), the flow rates for the most recent wells (Etty-
1, Hervey-1, Redland-1 and Geoffrey-1) appear much lower
and this can be attributed to a reduced number of hydraulic
stimulations in the wells and a conservative choke strategy
implemented during the most recent flow-testingâ€.
As a result of this work, DeGolyer and MacNaughton have
estimated that the 1C Recoverable Gross Contingent
Resource (as at 31 December 2014) in ATP 855 has
increased by 25 Bcf, from 318 Bcf to 343 Bcf, the 2C
Recoverable Gross Contingent Resource has increased by
943 Bcf, from 629 Bcf to 1,572 Bcf and the 3C Recoverable
Gross Contingent Resource has increased by 4,726 Bcf,
from 1,115 Bcf to 5,841 Bcf.
Gas In Place was estimated using the volumetric method
and applying a statistical distribution to the parameters
including recovery factor. These probabilistic estimates have
been made for each target formation and these have been
statistically aggregated. The key contingencies include the
need for longer flow tests to confirm expected ultimate
recovery with certainty, optimization of future well costs,
Gas Sales Agreements and connection to production
facilities.
The size of the area chosen for the assignment of
Contingent Resources was based on guidance from PRMS,
which indicates that a low estimate (
1C
) of area should
consist of two to three well spacings surrounding the
discovery well, a best estimate (
2C
) of area should be two
to three well spacings beyond this, and a high estimate
(
3C
) of area should be another two to three well spacings
beyond this. Well spacings vary between 80 acres and 160
acres dependent on the well type applied to address the
particular resource. As a result, the 2C resources were
estimated over an area of between 6,500 acres and 13,000
acres around each of the five wells tested, depending
on the particular formation. The total area of the ATP 855
permit is approximately 414,000 acres.
On 27 March 2015 Icon announced that Chevron Exploration
Australia 1 Pty Ltd (
Chevron
) would not be participating in
Stage 2 in ATP 855 in Queensland. The equity interests in ATP
855 following this decision are Beach Energy 64.9% and Icon
Energy 35.1% (unchanged).
Chevron advised Icon that the extensive technical evaluation
that the Joint Venture carried out has confirmed a large
gas resource and the potential for further appraisal and
development. However, at the time, the opportunity did
not align strategically with Chevron’s global exploration and
development portfolio.
However, the Stage 1 program achieved all the exploration
and technical objectives that were set by the Joint Venture
partners. This included flowing natural gas from four wells,
achieving the highest flow rate of 4.5 MMscf/d from a
shale gas well (Halifax-1) in the Cooper Basin, having
six Petroleum Discoveries in ATP 855 and identifying
a significant natural gas resource within the Permian
formations of the Nappamerri Trough.
The Joint Venture will now prepare a work program for the
next phase of activity, which will work towards further defining
the resource potential and ultimately progress the project
towards commerciality.
Qualified Petroleum Resource Evaluator Requirements
The information in this Annual Report relates to Contingent
Resources and is based on information compiled by Mr
Martin Berry, Exploration Manager and full time employee at
Icon Energy Limited. The Contingent Resources referred to
in this Annual Report are taken from an independent report
by DeGolyer and MacNaughton, a qualified international
petroleum reserve and resource evaluation company. Mr Berry
is a Qualified Petroleum Reserves and Resources Evaluator,
a Fellow of the Geological Society of London and a Member
of the American Association of Petroleum Geologists.
Mr Berry has over 35 years’ experience in the Petroleum
Industry including sufficient experience that is relevant to the
company’s Reserves and Resources to qualify as a Reserves
and Resources Evaluator as defined in the ASX Listing Rules.
Mr Berry consents to the inclusion in the report of the matters
based on his information in the form and context in which it
appears.
OPERATIONS REPORT
