In 2011, Dart Energy Limited (Dart) engaged Nautec Energy Solutions (Nautec) to conduct a Coal Seam Gas (CSG) Prospective Resource evaluation for PELs 456, 459, 460, 461, 463 & 464 in New South Wales, Australia. A Contingent Resource evaluation of PEL 463 was also undertaken at Dart’s request. Dart then re-engaged Nautec to prepare an updated report of licenses 456, 459, 460, 463 & 464 as of 31 December 2013.
The resource in these permits has been reassessed to take into account the relinquished areas and the changes in NSW regulations in relation to CSG.
All geological interpretation, gridding, volumetrics and mapping were performed using the SMT Kingdom and Petrosys software packages. Original gas in place was calculated according to the equation:
GIP(methane) = AREA x NET COAL THICKNESS x AVERAGE DENSITY x RAW GAS CONTENT x (1 – INERT GAS FRACTION)
The process used to determine each variable of the GIP equation is discussed in greater detail below. Each variable was calculated as a basin-wide grid with a 250m x 250m cell size. Multiplication of the grids to produce a GIP grid was performed using the grid arithmetic module in Petrosys. The volumetrics module of Petrosys was then used to determine the GIP for each resource area.
The report aimed to provide a concise overview of the data and methodologies employed and should not be considered an in-depth geological review.
Since 2011, the NSW government has brought into effect Stage 1 and 2 residential exclusions zones (2km buffer), Critical Industry Clusters (CIC) and Biophysical Strategic Agricultural Land (BSAL). The residential exclusions zones and CIC have had a direct effect on the resource estimate for PELs 456, 460, 464 and 463. These regulations are subject to ongoing change and it is unclear how these will affect Dart’s permits in the future. In addition, Dart has mapped the residential zones at a council level, which in part differ from the residential zones supplied by the government. These areas have been included in this study (additional residential – Dart research).
Evaluation and appraisal of PELs 456, 459, 460, 463 and 464 is at a relatively immature stage. Drilling to date has indicated the presence of thick coals and encouraging gas contents and compositions in some areas. Further drilling is required to better delineate coal thickness, distribution and quality, the distribution of CO2, and volumes of other inert gases, intrusions and permeability. Pilot testing is needed to demonstrate production potential.
In PEL 445 prospective resource’s “chance of discovery” is satisfied and therefore no further core holes are necessary. Upgrading to Contingent Resource will require evidence that HDP seams can flow gas.