Highlights

  • Red Sky Energy (ASX:ROG) has updated investors on the planned stimulation of Yarrow 4, Yarrow 5, and Yarrow North 1 in the Cooper Basin's Innamincka Dome, with stimulation of Yarrow 4 and 5 targeted to commence 27 November 2026.
  • Both Yarrow 4 and Yarrow 5 are expected to be tied into the existing Yarrow gathering system and brought online by mid-December 2026 following stimulation.
  • Yarrow North 1 stimulation is scheduled to follow on 30 November to 1 December 2026, with a tie-in decision pending flowback results.
  • Santos (ASX:STO) operates the wells with an 80% working interest; Red Sky holds the remaining 20% and advises it is funded for its share of the current program.

Red Sky Energy (ASX:ROG) has provided an update on the stimulation program for Yarrow 4, Yarrow 5, and Yarrow North 1, located in PRL 17 within the Innamincka Dome Joint Venture in the Cooper Basin, South Australia. The company holds a 20% working interest in the wells, with Santos (ASX:STO) operating the program with an 80% working interest.

Latest Development

According to the company, Santos has advised that stimulation of Yarrow 4 and Yarrow 5 is currently expected to commence on 27 November 2026, with operations scheduled across 27 to 29 November 2026. Both wells will be stimulated over two reservoir targets: the Patchawarra Formation and the Tirrawarra Sandstone. These are the same reservoir intervals from which Yarrow 1 and Yarrow 3 are currently producing gas.

Following stimulation and completion, Yarrow 4 and Yarrow 5 are expected to be tied into the existing Yarrow gathering infrastructure and brought online by mid-December 2026. The Yarrow North 1 stimulation is scheduled for 30 November to 1 December 2026, immediately following the completion of Yarrow 4 and Yarrow 5. A decision on whether to tie in Yarrow North 1 will be made following the flowback period — the phase after stimulation in which the well is flowed to clean up and assess its performance — with any tie-in of that well not expected before 2027.

Background and Reservoir Context

Yarrow 4 and Yarrow 5 were drilled in August and September 2026, respectively, and both intersected gas pay in the Patchawarra Formation and Tirrawarra Sandstone. Both wells were cased and suspended as future producers ahead of stimulation. The company describes these reservoirs as "tight" — meaning that gas does not flow freely through the rock without stimulation assistance — a characteristic well known in the Cooper Basin. Stimulation opens pathways from the reservoir to the wellbore, enabling the gas to flow at commercially meaningful rates. The analogue from Yarrow 1 — which was re-entered and stimulated in late 2025 and subsequently reached initial ramp-up production — provides a reference for what stimulation can achieve in this formation, though early-time production rates are not necessarily indicative of stabilised long-term performance.

Funding Position

Red Sky's share of the Yarrow authorisation for expenditure (AFE), comprising stimulation, completion, and connection of Yarrow 4 and Yarrow 5, is covered within already-committed capital. Its share of the Yarrow North 1 AFE, covering re-entry, stimulation, and conditional tie-in, is also within the existing committed program. The company stated that it is funded for its share of the current program.

About the Innamincka Dome JV

Red Sky holds a 20% working interest across six petroleum retention licences (PRLs 14, 17, 18, 180, 181, and 182) within the Santos-operated Innamincka Dome Joint Venture. The Innamincka Dome is a proven gas-producing area of the Cooper Basin, connected to Santos's Moomba Facility via established gas-gathering and pipeline infrastructure. This established connectivity is intended to reduce well development costs and shorten the time from production start to market delivery for newly tied-in wells.

Sector Context

The Cooper Basin is Australia's most established onshore gas production province, supplying gas to customers in New South Wales, Victoria, South Australia, and Queensland. With east coast gas market dynamics increasingly focused on domestic Supply adequacy, new well completions in proven basins like the Cooper attract sustained attention from both producers and energy policymakers.

Growth Drivers

For Red Sky, the stimulation and tie-in of Yarrow 4 and Yarrow 5 by mid-December 2026 would add new producing wells to its portfolio, complementing existing production from Yarrow 1 and Yarrow 3. Each new producing well incrementally increases the company's gas production exposure in a market where east coast gas prices have remained at levels supportive of ongoing development investment.

Risks and Challenges

Stimulation programs in tight reservoirs involve operational complexity, and the stated dates are estimates subject to change depending on equipment availability, weather, access windows, and operational scheduling. Post-stimulation performance will not be known until the wells have been flowing for a period following tie-in, and no production testing has been carried out at Yarrow 4 or Yarrow 5 to date.

Investor Considerations

For Red Sky Energy investors, the late November stimulation of Yarrow 4 and Yarrow 5 represents the most significant near-term operational event in the company's calendar. The reference to Yarrow 1's performance following its own stimulation and tie-in provides context for what might be achievable at the two new wells, though the company has appropriately caveated that early-time production rates are not indicative of stabilised long-term performance. If Yarrow 4 and Yarrow 5 are successfully tied in and commence production by mid-December 2026 as planned, Red Sky would then have four producing wells in the Innamincka Dome — a material increase in its gas production exposure. Yarrow North 1, which follows the main stimulation program, represents further upside potential pending flowback results. The company's status as a 20% non-operating interest holder means that all operational decisions rest with Santos, with Red Sky's key focus on funded participation in the AFE-approved program.

Key Insights

Red Sky Energy is approaching a material operational catalyst with the scheduled stimulation of Yarrow 4 and Yarrow 5 in late November 2026, followed by Yarrow North 1. The mid-December tie-in target for the first two wells, if achieved, would add new gas production to the company's portfolio ahead of the new year. Progress on this program will be closely watched by investors monitoring the company's Upstream development trajectory.