ADX confirms two fertile zones in Austrian oil find

European-based oil and gas producer ADX Energy has confirmed its Austrian Anshof-3 well would now be completed to bring its Eocene oil discovery and shallower Miocene gas discovery into production.

The company said data from electric logs suggested its primary Eocene oil target has a productive zone of 2.5 to 4 metres from a gross interval of 6m. Test results also interpreted 14m of gas pay zones from a 20m gross interval of the laminated Miocene reservoirs.

The discovery comes a mere 12 months after ADX got the green-light via its exploration permit - an impressive accomplishment in a sector that can often take many years to achieve the same milestone.

According to management whilst the productive zones within Eocene oil reservoir did not match the thickness of predrill expectations, the company will now seek to exploit the expected thicker zones to the east in order to fully exploit the potential of the Anshof discovery.

The oily Eocene reservoirs provide the most substantial reserves and value potential from the Anshof discovery according to ADX. Whilst the shallow gassy Miocene sands would potentially yield substantial near-term cashflow given the currently high gas prices in Europe which are the equivalent of US$35 per million cubic feet, or “mcf”. Incredibly, this compares with US gas where a five-year price high could not push past US$7mcf in late 2021.

However, news was not as good from ADX’s secondary Cenomanian oil target as the company noted the oil interpreted across an 11m interval would not be likely be productive at this location due to low permeability.

After the completion of casing and cementing operations ADX’s contracted drilling rig will be demobilised. The company said it has commenced engineering, planning and procurement to complete and test the well using a specialised, smaller and more cost-effective workover rig.

Much of the equipment and services required for completion and testing of the Anshof-3 well are available from ADX’s operations at the Gaiselberg and Zistersdorf fields.

Three hydrocarbon bearing zones of interest have been intersected at the Anshof discovery in a large, high relief structure providing very significant appraisal and development potential in an onshore setting adjacent to readily available gathering, production and export infrastructure.

The ability of our team on the ground to convert an exploration prospect to a discovery in a period 12 months from securing a license is extraordinary. The Anshof-3 well is expected to yield a second production asset in Austria for ADX in the near future.

In the short space of 12 months the ADX team has secured an exploration permit, worked up a drilling target, swung a rig into action and turned the prospect into a potential discovery that may become the company’s second income producing asset. Happy New Year indeed.

Is your ASX-listed company doing something interesting? Contact: matt.birney@wanews.com.au