Central Petroleum Ltd. (Company or Central) disclosed Tuesday that, as of June 30, internationally recognized petroleum consultants Netherland, Sewell & Associates, Inc. (NSAI)) estimated petroleum reserves and contingent resources for the 100 percent owned Palm Valley Field and Dingo Field in Northern Territory, Australia as follows:
Combined Palm Field Valley & Dingo Field (Central net share - 100 percent) in Petajoules (PJ)
Central expects the 2C contingent resources of 52.4 PJ (being contingent on markets) will be able to be converted into 2P reserves once the NT Gas Interconnect (NEGI) becomes certain, adding to the amount of gas available to underwrite that pipeline. Palm Valley and Dingo Gas Fields are accordingly forecast to have around a combined 109.2 PJ of 2P reserves when NEGI is certain.
Palm Valley Gas Field
Gas was discovered by the Palm Valley-1 well, drilled in 1965. Development of the gas field commenced after the grant of the Petroleum Lease on Nov. 9, 1981. Gas was first delivered to Alice Springs in 1983 through the 90 mile (145 kilometer) Palm Valley-Alice Springs gas pipeline and subsequently to Darwin in 1987 through the 939 mile (1,512 kilometer) Amadeus Basin-Darwin gas pipeline.
The Palm Valley structure is an elongate WSW to ENE trending anticline defined by 2D seismic lines. The reservoirs are sandstone enhanced by natural fractures. Gas deliverability is provided by a complex interconnected network of fractures which has resulted in extremely high open hole test flow rates (137 millon cubic feet per day or MMcf/d from Palm Valley - 6B) and good connectivity along the crest of the field.
A total of 11 wells have been drilled on the field, of which Palm Valley 1, 2, 6, and 7 are currently producing. Gas production rates at the Palm Valley gas field have continued to decline naturally, primarily as a consequence of the reduction in reservoir pressure and the influx of formation water in the productive fractures. The rate of pressure decline has reduced in recent years due to recharge from a large volume of tight gas connected to the fracture network. Reservoir pressures also increased following shut-in after the 2012 contract ceased.
Palm Valley Field is subject to a Gas Sales and Purchase Agreement with Santos for up to 25.65 PJ over 17 years (from commencement in 2012).
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