Production had now increased to more than 2.75 million cubic feet a day, a boost in gas output of more than 160% in just three months, reflecting major increases in production from two of the three latest wells, which were now contributing a significant proportion of overall field production.

“The three new production wells, Mungi-14, 16 and 17, have been hydraulically fracture-stimulated and are likely to have reached close to their peak production levels,” Molopo managing director Stephen Mitchell said.

The next series of production wells at Mungi are expected to be horizontal wells, following the success of this method in generating strong gas production results from the Mungi-2 horizontal well, according to Mitchell.

“Mungi-2 is currently producing at a stable rate of around 215,000cfpd from only one out of a possible five coal seams so there is considerable upside yet, particularly as our earlier fracced wells at Mungi produce less than Mungi-2 from four to five seams,” he said.

“Drilling of the first of these new horizontal wells is expected to commence in October, subject to rig availability.”

Use of horizontal drilling in well completion could translate into significantly higher production and recovery rates per well and lower field development costs, according to Mitchell.

Molopo has commissioned a reserve update for the Mungi field based on recent production results. The field currently has independently accredited total proven, probable and possible reserves of 56 petajoules, of which 26PJ are in the 2P (proven and probable) category.

The Mungi field in PL94 in the Bowen Basin is the closest CBM Production Licence to the significant Gladstone industrial market. All gas production from the Mungi field is being sold to Origin Energy under existing gas sale arrangements.

Interests in Mungi are Origin Energy Limited (50%), Molopo (25%), and Helm Energy-Australia LLC (25%).