Elixir Energy (ASX:EXR): Lorelle Flow Testing and Strategic Discussions

Aditi Sarkar

23 October 2026 07:49 PM AEDT

Elixir Energy (ASX:EXR): Lorelle Flow Testing and Strategic Discussions

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Highlights

Second phase of post-soak flow testing at Lorelle-3H began on 1 October 2026
Phase one recorded a peak gas rate of 10.4 mmscfd with no frac-sand production
Exclusivity with Beach Energy expired on 1 October 2026 without a binding agreement
Unsolicited expressions of interest were received from other parties
Lorelle-3H could become a foundation production well for the Warkon Pilot, subject to results

Elixir Energy Limited (ASX:EXR) is a Queensland-focused gas explorer and developer with principal activities in the Taroom Trough, a deep gas play in the Surat Basin. Two matters are active for ASX:EXR in October 2026: a second phase of flow testing at the Lorelle-3H appraisal well, and non-exclusive discussions about a possible farm-in after an exclusivity period ended.

Second-Phase Testing at Lorelle-3H

Lorelle-3H is a horizontal appraisal well in permit ATP2056, about 55 km from the Wallumbilla Gas Hub. Elixir owns 50% and operates the well during appraisal, while Santos (ASX:STO) owns the other 50% and is designated to operate the permit afterwards.

According to the 3 August 2026 announcement, phase one testing reached a peak gas flow rate of 10.4 mmscfd with condensate production of 10 bbl/d. The company reported no frac-sand production and recovery of 34% of injected stimulation fluid, which it described as high relative to offset wells. A 60-day reservoir soak followed.

On 1 October 2026, the company announced the start of post-soak flow testing, intended to assess sustained gas deliverability. In its 7 October 2026 response to an ASX query, ASX:EXR confirmed testing was still underway. It separately clarified that preliminary tracer-sample analysis did not establish the well’s viability or its long-term performance.

Discussions After the Beach Energy Exclusivity Period

Elixir had entered a process deed with Beach Energy (ASX:BPT) covering a possible farm-in to its Taroom Trough portfolio. The 2 October 2026 announcement stated that exclusivity expired on 1 October 2026 before binding documents were finalised, and that discussions continue on a non-exclusive basis.

The company also disclosed unsolicited expressions of interest from other parties during the exclusivity period, which it can now consider. The board stated that it intends to consider all available strategic alternatives. No transaction has been announced.

Warkon Pilot and Contingent Resources

The Warkon Pilot is co-located with Lorelle-3H. The company has stated that, if testing and a later reserves assessment are successful, the well could serve as a foundation production well for the pilot. It has not given a timeline for that assessment, and the ASX:EXR announcements do not list one.

The ASX:EXR announcements refer to about 3.5 TCF of independently certified 2C Contingent Gas Resources in the Taroom Trough, which it is aiming to appraise.

Key Insights

Confirmed facts are limited to completed and ongoing activity. Phase one testing of Lorelle-3H finished with the reported flow rates, the second phase began on 1 October 2026 and was still running as of 7 October 2026, and the Beach Energy exclusivity period ended without a binding agreement.

Company expectations remain conditional. A maiden reserves booking depends on the second-phase results and a later assessment, and the Warkon Pilot role for the well depends on the same outcomes. No date for results has been announced. Any farm-in or other strategic outcome for ASX:EXR would require agreed terms, which have not been published.

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