It is aiming to prove up the viability of natural gas production from the extensive brown coals that occur at shallow depths in ESG’s Victorian licence areas (EL 4507, EL4510 and EL4392).

The production is planned to continue over the next six months collecting data for the assessment of the drilling and completion technologies applied on brown coal, which has not been previously tested in Australia.

“Early this year the five wells were rehabilitated and they are producing from the Maddingly coal seam which is approximately 17 metres thick and which have not been stimulated," the company said.

"Aggregate daily water production is approximately 90 barrels and the next objective is to continue the dewatering until gas production commences and can be measured.”

The Oak Park Project is in EL 4507 and 4392 between the western suburbs of Melbourne and the town of Bacchus Marsh, about 35km west of the Melbourne CBD.

The Melbourne Trough area covered by the ESG exploration licences contains the second largest brown coal deposit in Australia, with an estimate of 10-12 billion tones of coal in a single seam (Maddingly seam), according to the company.

It said the gas resource potential of the target section within EL 4507 ranges as high as 500 petajoules, based on an analogy with the productive Powder River Basin (USA). ESG owns 100% of the Oak Park pilot project.