Highlights

  • Walyering West-1 achieved a stabilised gas flow rate of 11 million standard cubic feet per day (MMscf/d) from the C1 sand.
  • Flow testing confirmed a low-impurity gas accumulation within the Cattamarra Formation.
  • Gas composition showed low carbon dioxide levels of approximately 1-2%, consistent with existing Walyering production.
  • The well is located only 3 kilometres from the Walyering Gas Facility, potentially supporting future development through existing infrastructure.

Strike Energy Limited (ASX:STX) was in focus on 16 June 2026 after releasing flow test results from its Walyering West-1 exploration well in Western Australia's Perth Basin. The company's shares rose 1.90% to AUD 0.11 during the morning session following the announcement, suggesting investors responded positively to the operational update. Despite the gain, the stock remains down 33.13% over the past 12 months.

The latest results confirmed sustained gas flows from the primary target within the Cattamarra Formation and verified the presence of an additional gas accumulation in the broader Walyering field area. While further analysis remains underway, management indicated that reservoir performance and pressure data point to a potential development opportunity that could leverage existing infrastructure already operating at Walyering.

The announcement is particularly notable because the Walyering West-1 well sits only around 3 kilometres from the existing Walyering Gas Facility, potentially providing a pathway for relatively efficient commercialisation if ongoing assessments support additional reserves.

Strike Energy is an Australian energy company focused on the exploration, development and production of natural gas and energy projects. The company has established a presence in the Perth Basin through its Walyering gas operations and continues to evaluate opportunities to increase production and resource potential across its portfolio.

Flow Testing Confirms Additional Gas Accumulation

The key outcome from the latest testing program was confirmation that Walyering West-1 contains a gas accumulation within the targeted Cattamarra Formation.

Following a 12-day testing campaign, Strike successfully demonstrated sustained gas flow from multiple reservoir intervals, with the strongest performance coming from the C1 sand.

Management stated that the testing programme confirmed both reservoir quality and the existence of additional gas volumes adjacent to the producing Walyering field.

The result is important because exploration wells are drilled to determine whether commercially viable hydrocarbons exist within a target structure. The flow test provides further technical evidence regarding the productivity and characteristics of the reservoir.

According to Strike, data collected during the testing campaign will now be incorporated into future reserves and resources assessments in line with annual reporting requirements.

C1 Sand Delivers Highest Flow Rate

The strongest performance recorded during the testing programme came from the C1 reservoir interval.

The C1 sand achieved a stabilised gas flow rate of 11 MMscf/d through a 36/64-inch choke, with a flowing wellhead pressure of 1,575 pounds per square inch (psi).

At peak performance, the interval delivered an instantaneous gas rate of 16 MMscf/d before stabilising at 11 MMscf/d.

The test was conducted over approximately 25 hours and demonstrated favourable reservoir productivity compared with other intervals evaluated during the program.

In addition to gas production, the C1 sand produced condensate yields of approximately 15 barrels per million standard cubic feet (bbls/MMscf) while generating only limited water volumes of around 1.5 bbls/MMscf.

The company also reported carbon dioxide concentrations of approximately 2%, consistent with gas currently produced from the Walyering field.

For investors, the C1 results represent the most encouraging outcome from the programme because they confirm productive gas-bearing sands within the primary target zone.

Gas Quality Mirrors Existing Walyering Production

Another important takeaway from the announcement relates to gas quality.

Strike reported that gas recovered during testing exhibited low impurity levels, including carbon dioxide concentrations of approximately 1% to 2%.

This composition is broadly consistent with gas currently being produced from the existing Walyering field, providing useful insight into the nature of the accumulation.

Lower impurity gas can reduce processing requirements compared with gas streams containing elevated concentrations of contaminants.

The testing programme also identified condensate production rates that were higher than those currently associated with existing Walyering production.

Condensate is a valuable hydrocarbon liquid often produced alongside natural gas and can contribute additional revenue streams depending on market conditions and production volumes.

Management highlighted the higher condensate-to-gas ratio as a notable characteristic of the well.

Asub1 Sand Delivers Mixed Results

The testing programme also included evaluation of the Asub1 sand interval.

This zone recorded a stabilised gas flow rate of 2.8 MMscf/d through a 34/64-inch choke over a testing period of approximately 15 hours.

While the interval successfully produced gas, pressure behaviour observed during testing suggested a relatively limited connected reservoir volume.

Based on the information collected, Strike concluded testing activities for this interval without further extended evaluation.

The results indicate that although hydrocarbons are present within the Asub1 zone, the reservoir characteristics differ from those observed in the higher-performing C1 interval.

As a result, the C1 sand remains the primary focus from a development perspective based on current information.

Lower Reservoir Quality Impacts D1 Interval

The D1 sand was also tested individually during the flow testing campaign.

Unlike the C1 interval, the D1 zone did not produce hydrocarbons at measurable rates.

Strike noted that this outcome was consistent with earlier petrophysical analysis, which had indicated lower porosity and reduced reservoir quality within the interval.

Petrophysical data collected during drilling had already suggested that the D1 reservoir might not exhibit the same productive characteristics as other sands encountered within the well.

The flow test therefore provided confirmation of those earlier geological and engineering assessments.

While the D1 interval did not contribute commercially meaningful production during testing, the result improves understanding of the overall reservoir system and assists future development planning.

Water Production Observed in D2-D4 Sands

The D2 to D4 sands were evaluated as a combined interval during the programme.

However, upon opening the zone, the well produced formation water rather than commercial hydrocarbon volumes, resulting in the discontinuation of testing activities.

Subsequent analysis suggested that the D4 sand is likely the source of the water production observed during the programme.

According to Strike, petrophysical interpretation indicates the D4 interval exhibits higher water saturation compared with neighbouring sands.

Despite this outcome, management noted that the D2 and D3 sands may still warrant future evaluation.

The company indicated that a potential recompletion programme could isolate the D4 interval and allow separate testing of the remaining sands at a later date.

Such work could help determine whether commercially productive zones remain within the broader interval.

Existing Infrastructure Could Support Development

One of the more significant aspects of the announcement is the location of Walyering West-1 relative to existing infrastructure.

The well was specifically drilled to assess the potential for incremental gas supply from a structure situated adjacent to current production facilities.

Located approximately 3 kilometres from the Walyering Gas Facility, the well benefits from proximity to infrastructure already servicing the field.

Management indicated that reservoir pressure and productivity data support the possibility of future development through the existing facility, subject to the completion of post-test analysis and interpretation.

Infrastructure access can play an important role in project economics because it may reduce development timelines and capital requirements compared with greenfield projects requiring new processing facilities.

Although Strike has not yet provided a development decision, the location of the well enhances the strategic significance of the results.

Reservoir Evaluation Continues

While the testing programme has concluded, Strike emphasised that detailed technical evaluation remains ongoing.

The company is continuing to analyse pressure transient data, gas composition information and broader reservoir performance metrics collected during the campaign.

In addition, downhole pressure gauge data is still being integrated into the final interpretation process.

The outcome of this analysis will contribute to updated reserves and resources assessments in accordance with annual reporting requirements.

As a result, investors may receive additional information regarding the scale and commercial implications of the gas accumulation as technical studies progress.

The company has indicated that shareholder updates will be provided once the evaluation process has been completed.

Why Investors Reacted Positively

The market's response appears linked to several favourable aspects of the announcement.

Firstly, Walyering West-1 successfully demonstrated sustained gas production from the primary target interval, confirming the existence of an additional gas accumulation within the field area.

Secondly, the C1 sand delivered a stabilised flow rate of 11 MMscf/d, providing evidence of reservoir productivity.

Thirdly, gas quality was broadly consistent with existing Walyering production, including low carbon dioxide concentrations of approximately 1% to 2%.

Finally, the well's location near existing infrastructure creates a potential pathway for future commercialisation if ongoing analysis supports additional reserves.

While further technical evaluation remains necessary, the results provide new information that could support future development planning at Walyering.

What This Means for Investors?

Strike Energy's latest update provides additional insight into the potential of the Walyering West-1 exploration well. The flow testing programme confirmed an additional gas accumulation within the Walyering field area and demonstrated a stabilised flow rate of 11 MMscf/d from the C1 sand, which emerged as the most productive interval tested.

The well's proximity to existing infrastructure may provide development advantages if future reserves are identified. Although detailed reservoir analysis remains ongoing, the results offer further evidence of gas potential within the Walyering area and will contribute to future reserves and resources assessments. Investors are likely to monitor upcoming technical evaluations and any future development decisions related to the project.