The results from core, seismic and well data will allow Blue Energy to define a target area containing about 250 petajoules of contingent resources in and around the Cerulean Block, according to chief executive Bill Williams.

"As a high-pressure gas pipeline runs directly through the Cerulean Block, this would give us easy access to major Queensland gas markets and facilitate the early commercialisation of ATP854P," Williams said.

Blue Energy said it would now concentrate on assessing the full extent of this CSG resource.

"Areas to the south and west of the Cerulean Block will be tested using additional core and production well drilling to establish gas flow rates," Williams said.

"The Cerulean-2 and 3 wells within the prospective area of ATP 854P will achieve this objective."

Exploration also continues on the central area of Blue Energy's 100%-owned

ATP 817P, northwest of ATP 854P.

Exploration in both tenements has successfully targeted the Permian Bandana coals from which CSM is being produced in the nearby Santos Fairview and Origin Spring Gully Fields.