Lakes Oil yesterday said gas had flowed to surface in six minutes during the third drill stem test - over the interval 1464m-1497m. The maximum flow rate recorded during the second flow was 470,000 cubic feet per day, declining to just over 400,000 cubic feet per day, at the end of the one-hour flow period.

Afterwards the well was shut in for three hours for formation pressure build-up. The results from second drill stem test, over 1400m–1428m, flowed at a rate of 217,000 cubic feet per day.

Chairman Robert Annells said it appeared from Wombat-1 and 2, located in PEP 157, that the Strzelecki formation was gas charged over a large interval. “Drilling has shown that as we encounter reasonable permeability and porosity we are seeing substantial increases in gas levels.

“These sections will now be studied urgently as they appear to be excellent targets for horizontal drilling or major fracturing with the potential to lift flow rates.

“This has positive ramifications for the Trifon Tight Gas Project located immediately to the north of the Wombat structure, which is scheduled to commence shortly.”

Annells said it was too early to assess the effect of the new “non-invasive” drilling mud used in the Wombat 2 appraisal well, though the results were an improvement on Wombat-1.It was now intended to recover test tools and run in the hole to cut a core to assess the reservoir before drilling on.

Former permit holder Roma Petroleum NL is entitled to an overriding royalty of 5% of the wellhead value of any hydrocarbon production from Wombat.