The Mungi-2 lateral completion well at the Mungi coalbed methane field in the Bowen Basin is producing strong gas flows, the company said.

Mungi-2 is currently producing at a stable rate of around 250,000cf/d (cubic feet per day) from only one out of a possible five coal seams. This contrasts favourably with the existing nine fracced wells at Mungi which produce less than Mungi-2 from four to five seams.

As a consequence of these encouraging results, Molopo is proposing to drill additional lateral wells in the area with the first expected to begin during the current quarter.

“The Mungi-2 production profile represents a significant breakthrough in completion technologies at the Mungi Field,” said Molopo managing director Stephen Mitchell.

“This breakthrough could translate into significantly higher production and recovery rates per well and lower field development costs, which together would have a dramatic impact on the economics of the Mungi/Harcourt/Bindaree areas.”

Molopo was also encouraged by the fact that the Mungi 2 lateral well had shown a steady increase in gas production over the past six months, and was not exhibiting any notable production decline typical of the fracced wells at this stage, Mitchell said.

“This new multi-lateral well completion should represent a further marked improvement on well production profiles at Mungi with possibly six times more coal accessed than the Mungi 2 well,” he said.

“This should ultimately result in significant cost reductions for any given volume of coal drilled and completed.”

The lateral program was aimed not only at fulfilling current gas contracts, but also at producing a reserves upgrade ahead of further field development.

Currently, the Mungi field has independently accredited current total proven, probable and possible reserves of 56PJ of which 26PJ are in the 2P (Proven & Probable) category.

The Mungi coalbed methane gas field, located in PL94, is the closest CBM production licence to the significant Gladstone industrial market.