Lakes Blue Energy Advances Wombat-5 Testing with 237 Metres of Gas Sands

Strong Reservoir Signals at Wombat-5

Lakes Blue Energy (ASX:LKO) has advanced testing at its Wombat-5 gas well with pressure build-up data now reaching around 1,800 PSI, reinforcing the presence of a gas-charged reservoir despite formation damage from drilling. The company has confirmed three gas-bearing zones spanning a roughly 1,500-metre horizontal section, with a minimum of 237 metres of high-quality gas sands identified behind casing. These sands exhibit strong gas shows ranging from methane (C1) to pentane (C5), underscoring the potential of the reservoir.

Addressing Formation Damage and Flow Challenges

The pressure build-up phase, ongoing since the last update in March 2026, indicates a significant formation skin effect attributed to drilling mud invasion and clay swelling, which is currently restricting gas flow. To overcome this, Lakes plans a targeted program of propellant enhanced perforation (PEP) over at least 156 metres of the highest quality gas-bearing sands. The PEP technique aims to penetrate well beyond the damaged zone; estimated at 7 to 12 inches deep; accessing cleaner reservoir sections to boost connectivity and flow rates.

Complementing the perforation, the company intends to place a specially formulated inhibited completion brine designed to protect reservoir porosity and permeability during operations. Flow testing will follow, involving controlled flow rates and pressure monitoring to establish baseline productivity. Depending on these results, Lakes may deploy standalone propellant stimulation guns to further enhance well performance.

Regulatory and Operational Timing

These next steps hinge on regulatory approval of an amended operating plan, with Lakes targeting a late August 2026 start. The timeline also depends on completion of fluid compatibility testing and equipment availability amid ongoing international supply chain challenges linked to the Iran conflict. The company is working closely with regulators and service providers to keep the program on track.

Seismic Reprocessing to Sharpen Reservoir Imaging

Parallel to well operations, Lakes is reprocessing legacy 3D seismic data from 2008 with Geomage Ltd, employing advanced MultiFocusing™ technology to dramatically enhance imaging of the Strzelecki Formation. Preliminary results show a marked improvement in structural clarity and resolution, which could reveal previously obscured amplitude anomalies and fluid signatures. This enhanced dataset will inform inversion studies converting seismic reflectivity into rock property maps, aiding identification of high deliverability zones and guiding the design of a planned full-field seismic acquisition and development plan.