The well confirmed the presence of oil through the structural saddle between the Flax and Juniper oilfields, at the same time lowering the lowest known oil (LKO) level by about 24m, said Innamincka.

From the seismic mapping of the Tirrawarra, the field area above this new LKO was measured to be about 120 square kilometres. By comparison, the independent assessment of the Flax and Juniper fields in early 2006 attributed a combined area of 33sq.km.

The company said that following preliminary analysis of wireline log data from the PEL 103, Cooper Basin well, it was evident that the target Patchawarra formation and Tirrawarra sandstones were oil-saturated, with no evidence of water saturation in the targeted Permian section.

It estimated that total pay thickness was 14.8m, with the bulk of the sandstone net pay (10.2m) in the primary zone of interest.

The company said sandstone development for the primary zone was better than in most wells drilled to date in this region, and it had now cased and suspended Flax East-1 for future production.

Innamincka said the PEL 103 joint venture had now drilled eight wells in this field area, with all encountering oil-saturated sandstones in the primary target interval. The average net pay thickness for the basal Patchawarra-Tirrawarra interval was about 7m.

Using this average pay sand thickness, the in-place resource for the combined field above the new LKO was about 120 million barrels of oil, the company added.

It said there was also substantial additional upside down-structure from the new LKO and by other stratigraphically higher intervals in the Patchawarra and Toolachee Formations.

“The Flax East well result is a tremendous result for the potential of the region and for the PEL 103 joint venture,” said company secretary Leni Stanley.

“The exciting Flax East 1 result and the post-fracture stimulation performance of the Flax wells certainly encourage Innamincka Petroleum to accelerate evaluation and development activities.”

Innamincka said flowrate capabilities demonstrated by all four fracced and completed wells exceeding the criteria required for commercial production.

While current field production was restricted to the individual wells on clean-up flow and by the limited field infrastructure, consistent production was expected from mid-October, when temporary flowlines connecting all four wells was expected to have been installed.

The installation of a compressor was scheduled for late October, after which injection of produced gas via the Flax-1 well would start.

The company said fraccing of the Tirrawarra sandstone in the Flax-2 well had only provided limited flowback so far, but fraccing the higher basal Patchawarra sandstone had provided initial flowback of 200 barrels of fluid per day (150bbl oil and 50bbl frac fluid) with the well continuing to clean up.

In Flax-3, following fraccing of the basal Patchawarra-Tirrawarra, flowrates of 700bbl fluid per day (580bbl oil, 120bbl frac fluid) were measured during the cleanup process.

In the Flax-4 well, following fraccing of the Patchawarra-Tirrawarra, the well was flowing 200bpd of fluid (160bbl oil, 40bbl frac fluid) and continuing to clean up. It was anticipated this well would support a 150-200bpd flowrate during field production.

In Flax-1, following earlier fraccing, a flowrate capability of 300-350bpd had been determined for that well.

The Flax joint venture is Innamincka (operator with a 75% stake) and Seoul City Gas subsidiary, SCGAU, (25%).