L&M Energy has announced an aggressive schedule for 2010, with bosses bullish about coal seam gas and oil prospects.Speaking at the company's 4th annual general meeting, the first since the successful acquisition of L&M Coal Seam Gas in February,
L&M Energy has announced an aggressive schedule for 2010, with bosses bullish about coal seam gas and oil prospects.
Speaking at the company’s 4th annual general meeting, the first since the successful acquisition of L&M Coal Seam Gas in February, managing director Kent Anson celebrated the company’s move from coal seam gas explorer to producer.
Thanks to the merger, L&M Energy now holds the largest coal seam gas exploration portfolio in NZ, including 173PJ of certified 3P reserves at Ohai in the South Island, a capacity roughly equivalent to one year’s total national consumption.
Subsequent drilling at step-out well OM-4 has intersected an additional deposit of “thick gassy coals, with approximately 40m net across the two main horizons”.
The installation of a production pilot project at Ohai this year is hoped to make an upgrade to 2P status possible, improving the company’s ability to negotiate supply contracts.
Mr Anson said L&M Energy had been in discussions with a number of potential long-term offtake partners.
Oil on the horizon
Joint managing director John Bay is optimistic about L&M Energy’s petroleum prospects.
A joint oil exploration license with Mosaic Oil has turned up several “intriguing” shallow leads in the Taranaki Basin, and the company hopes to identify a potential drilling target by late 2010 or early 2011.
“We’re cautiously optimistic that at least one of these will be drillable,” Mr Bray told NBR.
Results from seismic tests under the license are due in four to six weeks.
L&M Energy has joined with Roc Oil, Mosaic Oil and Mighty River Power on an application for a new Taranaki exploration permit, with results on the application expected in the “very near future”.
On the West Coast, exploration under two existing permits has benefited from the replacement of dynamite techniques with a hydraulic “accelerated weight drop” method, and up to 35km is scheduled for prospecting over the next two years.
According to chairman Geoff Loudon, L&M Energy’s market capitalisation has quadrupled to more than $A90 million since the February merger.
