The company penetrated an upper sand in the well overnight, which is flowing at an estimated four million cubic feet of gas a day. The sands encountered are above the main target area designated for the original well and is a new production sand for the area.

Work will continue on Tinker 3H and the operations are expected to take an additional three days so that all targets can be penetrated.

Tinker 3H is the first of four wells to be drilled using coiled tubing horizontal drilling and nitrified liquids during its first trials in Australia.

Mosaic's 100%-owned Tinker 2, Tinker 3, Tinker 4 and Lark 1 wells in the Surat-Bowen Basin in southeast Queensland are being used as quick entry points at a depth of around two kilometres.

The drilling unit will drill up to 400m horizontally away from the existing well bore into potentially new oil/gas target zones.

Drilling of the other three wells is expected to proceed following the completion of Tinker 3.