The Perth-based company today said the target Toolachee Formation in Byrock-2 in permit ATP 269P in Eromanga Basin had been reached and encountered “strong shows”.

It said the well is drilling ahead to about 2060m below the rotary table with a drill stem test planned for today.

The well is a follow-up to Byrock-1, which recovered 14.5 barrels of oil on test from a 5m oil column in the Toolachee before being plugged and abandoned in January 1986 because the find was not considered commercial at the time.

If successful, Entek will earn 28.15% of production in Byrock-2, even though the final well to complete the earn-in obligation in the whole of ATP-269P is not scheduled to be drilled until next year.

Byrock-2 is the joint venture’s second well in a three-well staged drilling program. The first was Coolum-1, which was completed as an oil producer in February last year.

Stakeholders in Byrock-2 and ATP 269P will be Beach (operator with a 46.95%), Entek (28.15%), Inland Oil Production (20%) and Gidgealpa Oil (4.9%).

Meanwhile, the company also announced it is hoping to raise $2.25 million via a share placement to sophisticated investors of 15 million shares at 15c each.

The funds will be used for exploration costs for its oil and gas interests in the GoM, administration and working capital.

Plans for drilling of South Marsh Island Block 138 in the GoM, off the Louisiana coast in 225 feet of water, are at an advanced stage.

The drilling of the first well is expected to begin early December.