Category: Energy

Key Highlights

  • Emu Apple-1 is producing between 10 and 20 barrels of oil per day post-intervention, with no water cut observed to date
  • The company is assessing recommencement of Emu Apple-2, Emu Apple-3, Riverslea-1 and Riverslea-3 amid Brent oil prices approaching US$100 per barrel
  • California's Reclamation Board-7 and Reclamation Board-8 wells have been reinstated, flowing at a combined rate of approximately 350 Mcf per day
  • The company is negotiating with regulators in two separate international jurisdictions regarding exploration concessions

Production Update at Emu Apple

Australian Oil Company Limited (ASX:AOK) has provided an operational update across its oil and gas portfolio, reporting production momentum at the Emu Apple Oil Field in PL 264, located in the Surat Basin, Queensland. Following a recent well intervention, Emu Apple-1 has been producing between 10 and 20 barrels of oil per day, maintained at the same pump rate as before the intervention to optimise post-intervention clean-up. The company reported no water cut observed from the well to date, with fluid levels remaining higher than pump intake, which it said confirms communication between the well and reservoir. The company said the absence of water cut supports more efficient management of produced fluids, reduces pressure on evaporation pond capacity, and provides scope to increase production once the well has been further cleaned up.

Pricing Environment and Lifting Schedule

The next lifting of Emu Apple crude is anticipated within the next fortnight, timed to align with a strengthening in oil prices, with Brent Crude recently approaching US$100 per barrel. In response, the company is assessing the recommencement of production from Emu Apple-2 and Emu Apple-3, alongside restart work at Riverslea-1 and Riverslea-3. Additional lightweight hydraulic pumping units have been sourced for potential deployment across both fields, offering installation without concrete foundations.

Riverslea and Greater Riverslea Development

Development activity at PL 30, which contains the Riverslea and Yapunyah fields, is being accelerated in response to the stronger oil price environment and proximity to existing infrastructure. Final assays for Riverslea crude are being completed to support offtake arrangements and the planned restart of Riverslea-1 and Riverslea-3. Prospective resource work on PL 30 has been prioritised, given the proximity of mapped prospects to existing Riverslea infrastructure.

Major Gas Field Development

The company continues to progress development planning for the Major Gas Field in PL 512, where a raw gas sale agreement is being advanced to treat produced gas from Major-4. Final commercial and operational matters relating to metering, shutdown valves and communications are being negotiated for offtake, with wellhead pressures reported at 1,000 psi, consistent with other producing wells in the area.

Californian Gas Operations and International Exploration

In California, the Reclamation Board-7 and Reclamation Board-8 wells have been reinstated to production following maintenance works, flowing at a combined rate of approximately 350 Mcf per day. The company said routing these wells through the PEOCO-owned compressor is expected to lift combined rates toward approximately 500 Mcf per day. Californian gas prices continued to strengthen, remaining consistently above US$3.70 at Citygate during the last week of August. The company also confirmed it has been negotiating with regulators in two separate jurisdictions in relation to international exploration concessions, as part of its strategy to build a portfolio combining domestic production with international exploration opportunities.

Conclusion

Australian Oil Company's latest update outlines production gains at Emu Apple-1 in the absence of water cut, alongside plans to reactivate additional wells at Emu Apple and Riverslea in response to higher oil prices. With gas production increasing in California and gas offtake arrangements progressing at the Major Gas Field, the company also confirmed ongoing discussions with regulators in two international jurisdictions regarding new exploration opportunities.