Elixir completes 12-stage stimulation at Lorelle-3H, prepares for flow test

Fracture Stimulation Completed as Designed

Elixir Energy (ASX:EXR) has successfully completed a 12-stage fracture stimulation program at its Lorelle-3H appraisal well, located in the Taroom Trough of Queensland’s Bowen Basin. The operation, executed by Haliburton, achieved a rare feat with 100% of the proppant pumped being accurately placed within the target Tinowon ‘Dunk’ Sandstone formation. This precision has established a confirmed permeability pathway into the reservoir, verified by multiple pressure fall-off tests along the horizontal wellbore.

The stimulation’s effectiveness is a critical milestone, as it lays the groundwork for the next phase of testing gas and condensate flow rates that will underpin commercial viability. Concurrent rigging of flow testing equipment by Elixir and Enserve/SLB ensures readiness to capture detailed multiphase flow data during the upcoming flow-back period.

Milling Stage-Plugs and Preparing for Flow-Back

Currently, Elixir is milling out the stage-plugs installed during the stimulation, a process expected to take one to two days. This operation allows partial flow-back to commence gradually, easing the well into production without compromising the stimulated fractures. Post milling, the company will rig down the coiled tubing unit and begin a carefully managed flow-back sequence using incremental choke size increases. This methodical approach aims to preserve fracture integrity and prevent formation damage, optimising reservoir performance ahead of the 30-day production test.

Testing to Validate Commercial Potential

The forthcoming 30-day gas-condensate flow test is designed to demonstrate sustainable production rates and reservoir behaviour under real operating conditions. The test will measure gas and condensate ratios, pressures, temperatures, and other critical parameters to support development planning and potential reserve conversion. Lorelle-3H targets the Basin Centred Gas Play, with 1,033 metres of net gas-condensate pay identified in the Tinowon ‘Dunk’ Sandstone.

Elixir’s appraisal well is significant as it extends the operational footprint beyond Shell’s primary acreage in the Taroom Trough, reinforcing the value and scale of Elixir’s substantial ~3.5 TCF contingent gas resources. The project’s qualifying costs are eligible for a 48.5% refund under the Federal Government’s R&D tax incentive, improving the economics of this high-impact appraisal.

Strategic Importance of Lorelle-3H

The Lorelle-3 well, drilled in two phases including a 1,157-metre horizontal sidetrack, has delivered petrophysical results exceeding expectations. It confirms multiple thick gas and gas-condensate bearing reservoirs as viable appraisal targets. The well’s success will be a watershed moment for the Taroom Trough, demonstrating commercial potential outside Shell’s area and validating Elixir’s acreage position, which benefits from proximity to major gas infrastructure and LNG export facilities.

As Elixir moves into flow testing, the market will be watching closely to see if production rates support a commercial development pathway and reserve upgrades. The company’s careful execution of stimulation and flow-back protocols underscores the technical complexity and high stakes of unlocking this Basin Centred Gas Play.