Work to Return Bowen Basin's Mahalo-7 Well to Production to Begin in July

Coal seam gas explorer and developer Comet Ridge Limited provided Friday an operational update on the progress of the Mahalo 7 horizontal surface to in-seam well project. This well was drilled during the fourth quarter of 2014 in the ATP 337P Mahalo Block in Queensland’s Bowen Basin, Australia.

The Mahalo 7 surface to in-seam horizontal well was positioned inside the existing vertical pilot wells. It was drilled past the Mahalo 3 vertical well, on a path to intersect the down dip Mahalo 6 vertical well. Mahalo 6 is the production well to lift the water and gas from the Mahalo 7 horizontal well bore. The coal reservoir is at a depth of approximately 754 feet (230 meters) with a coal seam thickness of approximately 26 feet (8 meters).

During the first quarter of 2015, pumping of water from the Mahalo 6 well was undertaken very conservatively in order to protect the coal reservoir and bring the well on line in a gradual manner. While small flows of gas were initially observed for short durations during pumping operations on Mahalo 6, more sustained gas flows were observed during March. However during April, the Company advised that pumping efficiency had declined with evidence of produced gas running through the downhole pump. As pump speed was gradually increased, pump efficiency gradually decreased leading to the conclusion that the downhole pump would need to be changed, via a routine workover.

Comet Ridge has now been advised by the block Exploration Operator, Santos QNT Pty Limited, that the workover to replace the downhole pump, and return the well to production, is scheduled to commence on Saturday July 18.

This piece of work has also been formally approved through the joint venture. Whilst Comet Ridge has been disappointed with the time taken to design and schedule this pump-change workover, the Company is now pleased that the work has been formally scheduled and the well is now expected to be back on line next month.

The Mahalo block sits approximately 149 miles (240 kilometers) west of Gladstone in central Queensland and the Joint Venture has been operating two production pilot schemes at the Mahalo Field Pilot and Mira Field Pilot, since the first half of 2013. Comet Ridge received its first independent reserves certification for the Mahalo Block, which was detailed in a release to the ASX on Aug. 29, 2014.

Equity participants in ATP 337P Mahalo are Comet Ridge Mahalo Pty Ltd (40 percent), Australia Pacific LNG Pty Ltd (30 percent) and Santos QNT Pty Ltd (30 percent).


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