Transerv up on Warro result

Transerv Energy shares were up 23.5 per cent this morning after promising results from its Warro-5ST well, which showed deeper gas than had previously been found in the Warro onshore tight gas field.

Transerv executive director Stephen Keenihan said the results extended the potential vertical and lateral dimensions of the gas.

“The results are very strong and increase the economic potential of Warro significantly,” he said.

Mr Keenihan particularly highlighted that gas was still found at the total depth of the well, suggesting that the reserve may extend even deeper.

Warro has previously been estimated to contain between eight and 10 trillion cubic feet (TCF) of gas, with three to four TCF of that commercially recoverable.

As previously reported, Transerv is undertaking a two-well drilling program aimed at securing commercial flow without excessive water.

Water has been a frequently mentioned hindrance to the commercial viability of Warro’s tight gas.

In December 2013, Transerv chair Craig Ian Burton told Business News he believed ‘‘Warro has got a really good chance of working; it produces lots of gas but it also produces a fair bit of water.”

Transerv said in today’s announcement that gas-water contact had not been observed in the well.

The Warro field is a joint venture between Transerv and Alcoa of Australia, with Alcoa funding current exploration under a $100 million farm-in agreement, which will increase its stake from 43 per cent to up to 65 per cent.

The field is located about 200 kilometres north of Perth, and 31km east of the Dampier to Bunbury Natural Gas Pipeline.

Transerv shares were trading at 4.2 cents a share at 11 am Perth time.