This year’s program, which is expected to be completed by mid-year, includes establishing a confined production pilot by drilling eight closely spaced wells near the existing Bibblewindi-1 production well, ESG said.

Successful production testing would provide the joint venture, which also includes Hillgrove Resources and Gastar Exploration, with certification of an initial volume of 2P (proven and probable) reserves from an estimated 8.5 trillion cubic feet of gas, according to ESG.

Upon completion of the work program and production tests, ESG intends to connect all production wells in the Bohena Project Area, including the eight new wells, to the Wilga Park Power Station for electricity generation and sale.

Bibblewindi-10 is being drilled as an interim pressure monitor well away from the production pilot to extend the area of reserves.

Located 2.2km north of Bibblewindi-1, Bibblewindi-10 has a planned total depth of 1020m. The Bohena coal seam is expected to be intersected at a depth of 910m and to be more than 6m thick.

ESG said this well would be completed for fracture stimulation, and then production tested as part of next year’s program.

The other eight new production wells will be drilled to a total depth of about 1000m and completed with 5½-inch casing. They will be perforated at the Bohena coal seam and fracture stimulated, before being put on test production.

ESG said the combined production pilot was designed to accelerate dewatering of the 6.5-to-15m thick Bohena coal seam, and to achieve commercial gas production rates more quickly than would be possible for an isolated well, such as Bibblewindi-1, or for wells drilled on wider spacing.

Bibblewindi-1 was fracced late in 2004 and placed on continuous production test shortly after. ESG said initial results from the 6.5m-thick Bohena seam suggested a highly permeable coal seam with high water and increasing gas production rates.

Later this month, ESG plans to return existing wells Bohena-7, Bohena-9 and Bohena-3 to production and test equip them with newly installed, remotely monitored and controlled, and automated pumping systems.

The project is managed by ESG and is owned by the Gunnedah Basin Gas Project (CBM) joint venture comprising Gastar Exploration (35%), ESG (32.5%) and Hillgrove Resources (32.5%).