Both wells have been cycled through a series of production and shut in phases to obtain a range of flow and pressure data, and at each stages gas flows have quickly been re-established.

As it moves into the production phase Strike says that consistent, stable pumping operations have proved most effective in achieving sustained pressure reductions and increased gas flow rates, and that flowrates have only declined slightly from 3000psi to 2000-2400psi over the past few months.

At each stage the highly gas saturated coals have been able to maintain flow rates, and should be able to flow at average reservoir pressures below 500psi.

The company and its partner, Energy World Corporation (33.3%), are now seeking to find the lowest pressure level at which commercial flows can be maintained.

Klebb-1 has now produced data for 75 days, while Klebb-3 continues to dewater at about 100 barrels of water per day and Le Chiffre-1has flowed to provide 69 days of cumulative data.

Flow testing operations have now advanced to a second phase which aims to build gas flow rates through consistent reservoir pressure reduction at both Le Chiffre-1 and the Klebb pilot wells.

Minor modifications to the existing pumping equipment at the Klebb location are underway, which once implemented, will allow simultaneous flow testing of all three wells.

“The performance of the Klebb wells has been very encouraging and we now believe they are capable of achieving further production increases beyond their original design basis with modest additional investment,” Strike managing director David Wrench said.

As a result, the Klebb pilot will be upgraded in Phase 3 of the appraisal program through frac completions of Klebb-2 and Klebb-3 and installation of improved pumping infrastructure, which will accelerate reservoir pressure reduction and provide further reservoir and operational data for use in full development planning.

“The trends we are seeing at Le Chiffre and Klebb are extremely encouraging as we continue on the path towards commercial production. Strike now believes it controls one of the few projects with the potential to provide substantial new supply to East Australian gas markets with testing and production set to increase over coming months.”

Strike has secured a number of potential gas supply contracts with large companies such as packaging concern Orora and Orica for its gas from PEL 96, which reduce Strike’s commercial risks.

Strike says there is potential for 4.5 trillion cubic feet of net gas within PEL 96, which sits under a major Cooper Basin pipeline.

It is hoping to make a final investment decision before the end of the year with its gas to be some of the cheapest on the market with costs of $1 million per 1.5 petajoules being targeted, gas Wrench believes could meet domestic gas needs in eastern Australia and help fill any LNG feedstock shortfalls at Gladstone.