Lakes Blue Energy Advances Wombat-5 Drilling with New Fixed Price Deal
Lakes Blue Energy has resumed drilling at its Wombat-5 well in Victoria’s Gippsland Basin, overcoming earlier technical setbacks with a fresh contractor agreement. The company is making solid progress toward its target formation under a fixed price contract.
- Drilling resumed on 22 August after mud circulation issues resolved
- Current depth at 1100 meters measured depth, 260 meters above target
- Fixed price contract agreed with contractor to complete drilling
- Enhanced redundancy and mitigation measures implemented
- Targeting Strzelecki Formation at approximately 1360 meters true vertical depth
Resumption of Drilling Operations
Lakes Blue Energy has announced the resumption of drilling activities at its Wombat-5 well, located in the Gippsland Basin of Victoria. After a pause caused by mud circulation problems, the company and its drilling contractor reached a new agreement that allowed operations to restart on 22 August 2025. This development marks a significant step forward in the company’s exploration efforts in a region known for its hydrocarbon potential.
Technical Progress and Depth Milestones
Since resuming, the drilling team has advanced to a measured depth of 1100 meters below the rotary table, which is about 260 meters shy of the target Strzelecki Formation. This formation, a key geological target, lies at an estimated true vertical depth of 1360 meters. The drilling is progressing through the Latrobe Group strata, with the last casing set at 302.4 meters, ensuring well integrity as operations continue deeper.
Contractual and Operational Adjustments
To address the earlier mud circulation issues, Lakes Blue Energy and the contractor have implemented a series of operational safeguards. These include building substantial redundancy into the drilling system and introducing additional processes designed to prevent recurrence of the problem. Notably, the contractor has agreed to a fixed price arrangement for the completion of the well, which should provide Lakes Blue Energy with greater cost certainty and risk mitigation as drilling advances.
Strategic Implications
This update reflects Lakes Blue Energy’s commitment to overcoming technical challenges and maintaining momentum in its exploration program. The fixed price contract signals confidence from both parties in the well’s prospects and operational execution. While the company has not disclosed detailed financial terms or production expectations, the progress at Wombat-5 will be closely watched by investors eager for signs of resource potential in the Gippsland Basin.
Bottom Line?
Lakes Blue Energy’s steady progress and risk-managed approach at Wombat-5 set the stage for critical next-phase results.
Questions in the middle?
- What are the detailed terms and financial impact of the fixed price contract?
- How will the new redundancy measures perform under deeper drilling conditions?
- When can investors expect further updates on reaching and testing the Strzelecki Formation?