Galilee Energy Starts Zydeco-1 Drilling with $100K Cost Cut and 13.7 Bcf Gas Target
Galilee Energy has commenced drilling its Zydeco-1 well in Louisiana, executing a cost-optimised plan targeting up to 13.7 billion cubic feet of gas and 610,000 barrels of condensate, marking a key milestone in its US Gulf Coast expansion.
- Zydeco-1 well spudded on 1 July 2026, on schedule and budget
- Revised casing design cuts tubular costs by approximately US$100,000
- Gross prospective resources estimated at 13.7 Bcf gas and 610,000 barrels condensate
- Fixed-price drilling contract secured with RFC Drilling, LLC
- Cash position of $2.20 million and 36 million unlisted options issued
Zydeco-1 Drilling Launches with Cost Savings
Galilee Energy (ASX:GLL) has officially kicked off drilling at its Zydeco-1 well in Acadia Parish, Louisiana, on 1 July 2026, marking the start of its first US Gulf Coast drilling campaign. The company finalised the well design with a revised casing configuration that is expected to reduce tubular costs by around US$100,000, a meaningful saving in the context of a tightly budgeted program.
All major pre-spud activities, including site construction and rig mobilisation, were completed safely, on schedule, and within the planned budget. The drilling contract with RFC Drilling, LLC for Rig 103 is fixed-price, providing Galilee with cost certainty on rig rates, mobilisation, demobilisation, and core drilling services, which mitigates scheduling risks in the competitive Gulf Coast market.
Resource Potential Targets Conventional Gas-Condensate
Zydeco-1 is targeting the Upper and Lower Tweedle formations, with gross unrisked prospective resources estimated at up to 13.7 billion cubic feet (Bcf) of gas and 610,000 barrels of condensate in the 3U high case. These estimates are based on seismic interpretation and historical well data, including the 1950 MacCabees et al-1 well, which intersected gas in the Upper Tweedle sandstone and flowed at commercial rates during testing.
The project area covers 325.3 acres of mineral leases wholly owned by Galilee, with a 70% net revenue interest. The proximity of Zydeco-1 to a proven well reduces subsurface uncertainty, supporting a relatively low-risk drilling target in a proven Gulf Coast gas-condensate fairway.
Operational Progress and Team Strengthening
Site preparation included construction of the access road, drilling pad, and equipment staging areas, all completed by late June. RFC Drilling Rig 103 was mobilised to site, with the derrick raised and key pre-spud activities such as conductor installation and cellar preparation finalised ahead of spudding.
Galilee has also bolstered its technical team by appointing Jenni Kessler, an experienced Gulf Coast geologist with a track record in successful project development. This appointment complements the guidance provided by the company’s US Advisory Board, which includes seasoned oil and gas operators and technical specialists.
Financial Position and Corporate Activity
At quarter-end, Galilee held a cash balance of $2.20 million. During the quarter, the company issued 36 million unlisted options to investor relations and marketing consultants, split evenly between exercise prices of $0.011 and $0.016, expiring in June 2029.
Exploration and development expenditure related to the Zydeco-1 drilling program amounted to approximately $4.682 million during the quarter. Payments to related parties totaled $161,000, covering director fees and incentives.
Bottom Line?
Galilee’s Zydeco-1 drilling start with cost efficiencies and a solid resource target sets the stage, but the commercial viability hinges on forthcoming well results and flow testing.
Questions in the middle?
- Will Zydeco-1 confirm commercial quantities in the Upper and Lower Tweedle formations?
- How will Galilee manage funding and capital needs if the drilling success leads to accelerated development?
- What is the timeline for flow testing and subsequent production decisions following drilling completion?
