Elixir Energy (ASX:EXR) Advances Warkon Pilot with APA Pipeline Feasibility Complete

Sonal Goyal

02 September 2026 11:01 AM AEST

Elixir Energy (ASX:EXR) Advances Warkon Pilot with APA Pipeline Feasibility Complete

Image Source: Shutterstock

You are reading a free article with opinions that may differ from the recommendation given by Kalkine in its paid research reports. Become a Kalkine member today to get access to our research reports, in-depth technical and fundamental research. Learn more

Start Your Free Trial Now!

Key Highlights

APA Group has completed feasibility work on a direct pipeline route connecting the Warkon Pilot to the Wallumbilla Gas Hub, identifying it as the most economic path to market
The feasibility study covered a capacity of 40 TJ/d, scalable between 5 and 150 TJ/d, with indicative tariffs ranging from $0.35/GJ to $1.32/GJ depending on throughput
Simpliphi Pty Ltd has been appointed to complete Concept Select and engineering work on the Warkon Pilot's Upstream plant, expected to conclude this quarter
Commercial production evaluation will follow the second phase of flow testing at the Lorelle-3H well, scheduled to commence on 1 October 2026

Elixir Energy Limited (ASX:EXR) has provided an update on its northwestern Taroom Trough gas and condensate production pilot project, now referred to as the Warkon Pilot. The company confirmed that APA Group has completed feasibility work on the custody transfer and pipeline route to the Wallumbilla Gas Hub, while Simpliphi Pty Ltd has been appointed to progress engineering work on the pilot's upstream plant.

Pipeline Feasibility Findings

APT Management Services Pty Ltd, a Subsidiary of APA Group, completed feasibility work under an Early Works Agreement announced in April 2026, examining the optimal path to market for gas produced at Warkon. The study found the best Economics arise from a direct pipeline running northeast to the Wallumbilla Gas Hub, which serves as the exchange for wholesale gas trading in Queensland and connects nine major pipelines linking the Surat and Bowen Basins to domestic and LNG export markets.

The feasibility work assessed a custody transfer point incorporating gas chromatography, a metering station and infield compression, covering a capacity of 40 TJ/d that could be operated between 5 and 150 TJ/d. A preliminary Class 5 cost estimate indicated a 15-year Tariff on this infrastructure would carry capacity charges between $0.35 per gigajoule and $1.32 per gigajoule depending on whether throughput sits at 150 or 40 TJ/d respectively, with charges falling 74% upon full utilisation. APA has identified two viable pipeline routes of similar length, 52 and 53 kilometres, providing flexibility in land access and environmental approvals during detailed design.

Upstream Plant and Engineering Work

As gas comes to surface, minor upstream conditioning is required to meet pipeline specifications, including condensate drop-out, dehydration and temperature management. Elixir has engaged Simpliphi Pty Ltd to complete Concept Select work on the design and capacity of this upstream plant, with the engagement covering concept design and engineering, a project risk assessment, a preliminary cost estimate and a project execution plan. This work is expected to be completed in the current quarter. The company noted there is scope to collaborate with neighbouring Taroom Trough operators on shared infrastructure across the plant, custody transfer point and pipeline.

Path to Commercial Production

Elixir said the studies on the upstream plant and APA's proposed infrastructure provide inputs for evaluating commercial production for future Reserves bookings, a process the company intends to pursue following the second phase of flow testing at the Lorelle-3H well, scheduled to commence on 1 October 2026. Managing Director and CEO Stuart Nicholls said the Warkon program is intended to define Elixir's pathway from appraisal to commercial production, with the company's proximity to the Wallumbilla Gas Hub seen as a Competitive Advantage that could lower development costs and Capital hurdles.

Conclusion

Elixir Energy's completion of pipeline feasibility work with APA Group and the appointment of Simpliphi for upstream plant engineering represent incremental steps in the company's plan to develop the Warkon Pilot into a commercial gas production project. With flow testing at Lorelle-3H due to begin in October 2026 and further Reserves evaluation to follow, the pace of subsequent development will depend on the outcomes of that testing alongside ongoing engineering and infrastructure planning.

FAQs

Q: What is the Warkon Pilot?

A: The Warkon Pilot is Elixir Energy's northwestern Taroom Trough gas and condensate production pilot project in Queensland.

Q: What did APA Group's feasibility study find?

A: APA found the best economics for delivering Warkon gas to market involve a direct pipeline northeast to the Wallumbilla Gas Hub, with indicative capacity charges of $0.35 to $1.32 per gigajoule depending on throughput.

Q: Who has Elixir appointed for upstream plant engineering?

A: Simpliphi Pty Ltd has been appointed to complete Concept Select and engineering work on the Warkon Pilot's upstream plant, expected to conclude in the current quarter.

Q: What is the Wallumbilla Gas Hub?

A: It is the exchange for wholesale gas trading in Queensland and a key interconnection point for nine major pipelines linking the Surat and Bowen Basins to domestic and LNG export markets.

Q: What is the next major milestone for the project?

A: The second phase of flow testing at the Lorelle-3H well is scheduled to commence on 1 October 2026, which will inform Elixir's evaluation of commercial production and future Reserves bookings.

Download Free Report – Explore 3 Stock Ideas & Industry Insights

Unlock 3 stock ideas and key industry insights in our free report. This information is general in nature and does not consider your personal objectives, financial situation, or needs. It is not financial advice.

All investments involve risk—consider independent advice before making any investment decisions.

View 3 Research Reports

Disclaimer:

This article (“Article”) has been prepared by Kalkine Pty Limited (ABN 34 154 808 312) (Australian financial services licence number 425376) (“Kalkine”) and its related bodies corporate who are authorised to provide general financial product advice. Kalkine.com.au and its associated pages are published by Kalkine.

Any information/advice provided in this article is general in nature and does not take into account your objectives, financial situation or needs. You should therefore consider whether the information is appropriate for your objectives, financial situation and needs before acting upon it.

There may be a Product Disclosure Statement, Information Memorandum or other offer document (“Offer Document”) for the securities or other financial products referred to in Kalkine articles. You should obtain a copy of the Offer Document and consider it before making any decision about whether to acquire the security or financial product.

Kalkine strongly recommends that you seek advice from a financial adviser, stockbroker or other professional (including taxation and legal advice) before acting on any advice/information in this Article or on the Kalkine website. Not all investments are appropriate for all people.

The information in this Article and on Kalkine website has been prepared from a wide variety of sources, which Kalkine, to the best of its knowledge and belief, considers accurate. Kalkine has made every effort to ensure the reliability of the information contained in its articles (including this Article), newsletters and websites. All information represents our views at the date of publication and may change without notice.

The information in this Article does not constitute an offer to sell securities or other financial products or a solicitation of an offer to buy securities or other financial products.

Kalkine does not issue, sell or deal in any financial products.

This Article may contain information on past performance of particular investments. Please note past performance is neither an indicator nor a guarantee of future performance.

To the extent permitted by law, and excluding any dishonesty or gross negligence by Kalkine, Kalkine disclaims and excludes all liability for any direct, indirect, implied, punitive, special, incidental or other consequential loss or damage arising from the use of or reliance on this Article, the Kalkine website and any information published on the Kalkine website without any warranties or representations by Kalkine to you. To the extent the law prohibits or limits this exclusion, Kalkine limits its liability to the resupply of services.

Please also read our Terms & Conditions and Financial Services Guide for further information.

Employees and/or associates of Kalkine and its related entities may hold interests in the securities or other financial products covered in this Article or on the Kalkine website. Any such employees and associates are required to comply with certain safeguards, procedures and disclosures as required by law.

Some of the images/music that may be used in the Article are copyright to their respective owner(s). Kalkine does not claim ownership of any of the pictures displayed/music used in the Article unless stated otherwise. The images/music that may be used in the Article are taken from various sources on the internet, including paid subscriptions or are believed to be in public domain. We have used reasonable efforts to accredit the source wherever it was indicated or was found to be necessary.

Kalkine Media Pty Ltd, an affiliate of Kalkine Pty Ltd, may have received, or be entitled to receive, financial consideration in connection with providing information about certain entity(s) covered on its website.