High Overpressure and Stacked Reservoirs Boost Risks and Rewards for Omega’s Taroom Trough

Commercial Breakthrough in the Taroom Trough

Omega Oil and Gas Limited (ASX – OMA) has delivered a compelling update on its 100% owned Canyon oil and gas project, situated in Queensland’s emerging Taroom Trough. The company’s collaboration with SLB (formerly Schlumberger) has yielded reservoir modelling results that underscore the commercial potential of the Canyon Sandstone formation. According to SLB’s analysis, a single 2,000-metre horizontal well could produce an estimated ultimate recovery (EUR) of approximately 0.95 million barrels of oil equivalent (MMBOE), combining oil and gas volumes over a 10-year period.

This modelling is based on data from the Canyon-1H flow test and petrophysical analysis of multiple wells, including Canyon-1, Canyon-2, Tasmania-1, and Fantome-1. The results are particularly encouraging given the net pay thickness assumptions and fracture stimulation designs applied, which suggest that Omega’s acreage; spanning over 1,075 square kilometres; could support up to 418 such wells spaced at 1,000 metres apart.

Reservoir Quality and Overpressure Confirmed

Further validation comes from the Canyon-2 well, located nearly 16 kilometres south of Canyon-1, where cased hole wireline logging revealed a thicker net pay zone of 23.4 metres and the presence of five stacked reservoir intervals containing both oil and gas. The Diagnostic Fracture Injection Test (DFIT) conducted at Canyon-2 confirmed a high reservoir pressure gradient of 0.72 psi/ft, indicative of a highly overpressured system. This level of overpressure is comparable to prolific US unconventional basins such as Eagle Ford, which bodes well for production rates and commercial viability.

Omega’s CEO and Managing Director, Trevor Brown, highlighted the significance of these findings, noting that the data not only confirms the commercial development potential of the Canyon Sandstone but also points to substantial upside beyond current estimates. This includes the possibility of improved reservoir properties across the acreage and additional reservoir levels yet to be fully appraised.

Strategic Path Forward

Looking ahead, Omega plans to delineate the highest quality reservoir zones and further define the scale of this promising oil and gas province. The company is preparing to initiate pilot projects aimed at testing commercial production pathways for both oil and gas. Concurrently, Omega is engaging with the Queensland Government and industry partners to explore market access and infrastructure options that could lower development thresholds.

In a strategic move to accelerate growth and de-risk its portfolio, Omega is actively considering partnerships and potential sell-downs of selected acreage to bring in capital from larger players. Early-stage oil production is also on the table as a means to generate near-term cash flow. Additionally, the company remains open to expanding its footprint through farm-ins, mergers and acquisitions, or bid round tenders as the Taroom Trough gains recognition as a significant emerging energy province.

Omega’s recent technical successes and strategic initiatives position it well to become a key contributor to Australia’s energy future, leveraging both its technical expertise and the growing interest in unconventional resources within the Bowen Basin.