Kinetiko Energy (ASX: KKO) has received a boost regarding its plans to develop an answer to South Africa’s critical energy shortages with a new drilling strategy appearing to have overcome previous flow issues.
The company’s flow testing numbers earlier this year came in under the expected rates, leading to an in-depth assessment of what was causing the problem.
Kinetiko has now developed optimised drilling procedures incorporating detailed recommendations based on laboratory testing conducted by flow-assurance experts Oilfield Technologies Australia (OTA).
Kinetiko designed the new 271-KA03PT10 well according to the adjusted drilling parameters – which include reduced water volume, no use of high-volume foam, and controlled down-hole pressure – to address OTA’s key findings on the reduced permeability and gas flow the company had encountered in the previous two production test wells.
Choke tests Kinetiko performed on completion of the optimised drilling achieved a peak gas flow rate of 370,000 standard cubic feet per day, with extended flow rate testing now underway to determine a stabilised flow rate.
The company’s geophysical logging of the well has also confirmed a 144-metre net pay zone in a well it had drilled to a total depth of 417m.
The results are good news for Kinetiko, which is aiming to develop its advanced shallow conventional gas projects in the country’s Mpumalanga province.
Well 271-KA03PT10 sits within 500m of historical production test wells and will form part of an initial cluster of producing gas wells to supply a planned micro LNG pilot plant, with Kinetiko expecting spudding within 7 days.
According to Export Finance Australia, South Africa’s economy is now smaller than pre-COVID-19 levels, with a bleak economic outlook reflecting the nation’s ailing power infrastructure and shortage of new energy sources.
“With the rig now mobilising to the next site, we are focused on building production capacity and accelerating our transition to first LNG,” executive chair Adam Sierakowski said.
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