The company said yesterday it had spudded Lacerta-5, the first of four CSM production wells designed to test the productivity of the Walloon Coal Seams that were identified during a core-hole program undertaken by Sunshine in June.

The target seams at Lacerta produce gas in the adjacent Coxon Creek CSM field. Once drilled and completed, the Lacerta pilot wells will be placed on extended production test to de-water the coal seams and determine whether the subsequent gas flows are economically viable.

These tests will also provide data towards Lacerta’s reserve certification program.

Each pilot well is expected to take about six days to drill, case and suspend.

Sunshine reiterated that it currently believes the CSM project contains some 230 billion cubic feet (BCF) of contingent gas resources.

Sunshine managing director Tony Gilby was instrumental in establishing successful CSM mid-cap Arrow Energy and has said he sees Sunshine, one of the few remaining Queensland CSM players to have avoided the wave of consolidation now sweeping across the sector, as being about two years behind Arrow.