The upper part of the Kingia sandstone was the primary target of the well, holding a 10m interval which was perforated without stimulation on Sunday.

A preliminary maximum gas flow rate of 18.5 million standard cubic feet was observed before settling down to 12.4MMscfpd.

The gas composition from the target mirrored that of gas taken from the secondary High Cliff sandstone last week, showing mostly methane with about 2% carbon dioxide.

AWE will conduct an extended flow of the Kingia as part of its phase two flow test operations.

The well will be shut in to build up pressure before a series of flow tests are conducted at different choke settings, rates and well head pressures. These operations are expected to occur over the week.

The extended pressure build-up survey and full testing program is scheduled for completion by mid-April.

"This is an excellent result for AWE, the local community and Western Australia," AWE managing director Bruce Clement said.

"The initial flow test results confirm the Kingia Sandstone is a conventional gas reservoir capable of producing commercial flow rates of gas. It has also confirmed the potential for an exciting new gas play in the North Perth Basin."

AWE reckons its Waitsia field could hold a gross 2C contingent resource of 290Bcf of gas with an upside of up to 1.17 Tcf, spurring it to plan two appraisal wells for the year ahead.

Waitsia-1 will be drilled around late May, following the Irwin-1 exploration well in the nearby EP320 permit.

AWE's work at Waitsia, conducted on a 50-50 basis with Origin Energy, is been keenly watched by other players in the Perth Basin.

Norwest and its EP368 joint venture partner Empire Oil and Gas are hoping that some of the predicted upside in the field might be present in a possible extension of the play into their 600sq.km permit, just to the east of Waitsia.

Empire, as the operator of EP368, is thus planning an airborne gravity gradiometry imaging survey over the permit and the adjoining EP426 tenement during this quarter.

AWE is currently investigating routes to commercialisation of its discovery.

"AWE is … undertaking engineering studies on potential low cost, early stage development of the Waitsia gas field using existing gas plants and pipeline infrastructure to deliver gas into the WA domestic market," Clement said.

"The Waitsia gas field has the potential to be a significant source of gas for the WA domestic market. The long-term outlook for gas prices in WA is positive and we have commenced work on gas marketing."