- Natural gas and helium producer Renergen (RLT) is progressing the second hole in a drilling program at its Virginia Gas Project in South Africa nicely
- Last month, the company abandoned the first hole at the inclined well after losing important drilling equipment downhole before breaking through the base of the Karoo sedimentary rock
- However, Renergen said today the re-drill, dubbed P2V2, has now completed setting of the intermediate casing
- According to CEO Stefano Marani, this means the hole is now past the risky section of drilling and is on track to drill through the base of the Karoo
- On top of this, Renergen says a second drilling rig has been mobilised and is expected to begin operations by the October 30
- Shares in the company are trading almost 2 per cent lower this afternoon and currently worth $1.07 each
Renergen (RLT) is progressing the second hole in a drilling program at its Virginia Gas Project in South Africa nicely.
The company abandoned the first drill hole at the inclined well in September after losing important drilling equipment downhole before breaking through the base of the Karoo sedimentary rock.
At the time, Renergen said the well was of no cost to the company until the base was successfully penetrated, and so it made the call to move on instead of spending valuable time and resources trying to retrieve the lost equipment.
Today, Renergen said a re-drill in the area, dubbed P2V2, has now completed setting of the intermediate casing and is on track to drill through to the base of the Karoo and the targeted gas-bearing fault structures.
The company expects the well to be either at or close to target by the end of the first week of November.
On top of this, Renergen said a second drilling rig has been mobilised and is expected to begin operations by the October 30. This rig will re-enter an old cased exploration hole known as MDR1, which is close to a known gas-bearing fault.
Renergen CEO Stefano Marani said the company has made some big strides in getting drilling back on track.
"P2V2 is now past the risky section of drilling and should start moving much faster," Stefano said.
"Adding to this is the re-entry of well MDR1, which is already drilled and cased past the Karoo," he added.
"This reduces time and cost significantly, and being within close proximity to the gas-bearing faults means we do not only have the opportunity to bring additional flow online but also to obtain important new geological data," he explained.
The Virginia Gas Project is made up of 187,000 hectares of gas fields across Welkom, Virginia and Theunissen, in the Free State of South Africa.
Renergen currently produces compresses natural gas (CNG) from the area, but its strategy is to expand the project to produce both liquid helium and liquified natural gas (LNG).
Shares in Renergen are trading a slight 1.83 per cent lower this afternoon, worth $1.07 each at 12:32 pm AEDT.