Highlights

  • Drilling at Killanoola-2 safely reached 1,044m total depth without incident.
  • Petrophysical analysis confirms hydrocarbons in Upper Sawpit Sandstone with low permeability.
  • Well cased and suspended; stimulation options and workover plans under review.

Red Sky Energy Ltd (ASX:ROG) announced the completion of drilling operations at the Killanoola-2 (KN2) oil appraisal well, located in Petroleum Retention Licence 13 (PRL-13) within South Australia’s onshore Otway Basin.

The well reached a total depth (TD) of 1,044 metres measured depth (MD) without incident and has been cased and suspended with production tubing installed as a potential future producer.

Wireline logging was completed using a full suite of Gamma Ray, Sonic, Resistivity, Density, and Neutron tools. The company’s petrophysicist carried out a detailed analysis following the acquisition of neutron-density logs.

Hydrocarbons Confirmed but Limited Production Potential

The analysis confirmed the presence of hydrocarbon-bearing zones in the Upper Sawpit Sandstone. However, results indicated low permeability, high water saturations, and a high degree of shale interbedding — factors that limit reservoir connectivity and potential flow rates in its current unstimulated state.

Due to these reservoir characteristics, Red Sky decided not to proceed with the contingent Drill Stem Tests (DSTs). Instead, a wiper trip was conducted, and the well was suspended for future evaluation and completion activities.

Management Commentary

Red Sky Energy Managing Director, Andrew Knox, stated:

“We have advanced KN2 safely and efficiently, and now have two suspended wells that correlate closely to the 3D seismic model. Our next priority is testing the production potential through a fit-for-purpose completion and possible stimulation plan. We remain optimistic about unlocking value at Killanoola through targeted, regulatory-compliant artificial lift and stimulation.”

Forward Plan

Red Sky intends to complete both KN2 and the nearby DW1 well using a workover rig. The completion plan will assess the wells’ production potential through suitable completion and stimulation methods.

Next Steps

The company will evaluate the feasibility of stimulation activities, subject to regulatory approvals. Red Sky also plans to advance its analysis of well performance and reservoir connectivity once the workover operations are complete.

Under ASX Listing Rule 5.30, Red Sky reported that KN2 is located in the Otway Basin under PRL-13 and reached a total measured depth of 1,044 metres targeting the Upper Sawpit Sandstone. Modest oil was observed during petrophysical interpretation, and the well remains cased and suspended with production tubing in place.

The company’s Total Petroleum Initially In-Place (PIIP) figures, consistent with the SPE-PRMS classification framework, were sourced from an independent Competent Person’s Report dated 21 April 2023. These estimates remain classified as un-risked prospective resources and are subject to significant technical and commercial risk.

Share Performance

ROG’s shares traded at AUD 0.003 per share on 03 November 2025, down by 40% from its previous close of AUD 0.005.