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ADX Energy rig charges towards Welchau gas prospect in Austria

Updated: Mar 25

The start to rigging up at ADX Energy’s Welchau-1 drilling location. Credit: File

ADX Energy is putting the final touches on a targeted assault on its Welchau gas prospect in Austria, moving and assembling its pre-approved drill rig for 200km from the Vienna basin, with an expectation to be drill-ready in just six days.

The potentially large-scale Welchau prospect is in the heart of Europe. It features shallow drill depth and is near major gas pipelines.

The company says Welchau has exceptional gas resource potential, with estimated technical prospective resources of 807 billion cubic feet equivalent (BCFE), or 134 million barrels of oil equivalent (MMBOE).

Prospective resources are the estimated quantities of petroleum that may be recovered by a future development project related to undiscovered accumulations. Further exploration appraisal and evaluation is required to determine if a significant quantity of potentially moveable hydrocarbons exists.

ADX has executed an energy investment agreement with MCF Energy for the latter to fund half of the Welchau-1 well costs up to a cap of €$5.1 million (AU$8.4 million) to earn a 25 per cent economic interest in the Welchau Investment Area – part of ADX’s ADX-AT-II licence in upper Austria.

The Welchau Investment Area contains the Welchau gas prospect and other emerging oil and gas prospects. ADX will retain a 75 per cent economic interest in the Welchau Investment Area upon MCF’s funding obligations being completed.

The Board of ADX is very pleased that drilling rig mobilisation to Welchau has commenced and drilling operations can start within the week. We can now focus on the drilling of this potentially significant gas resource for the benefit of the Republic of Austria, our partner MCF and ADX shareholders. ADX Energy executive chairman Ian Tchacos

Management says it is targeting the same reservoirs as the nearby Molln-1 well that tested condensate-rich, pipeline-quality gas at rate of 4 million standard cubic feet (MMscf) per day in 1989.

ADX has purchased the long lead items and contracted all the necessary services required to drill its Welchau-1 well. The drilling is under an existing rig services contract with RED Drilling & Services.

The RED E200 drilling rig, together with the previously contracted E202 drilling rig that was substituted due to operational difficulties, have been pre-approved for the Welchau-1 well based on the required safety, noise and environmental emission standards being satisfied.

The success-case drilling and evaluation program is expected to take about 39 days.

ADX has a range of oil and gas assets throughout Europe, focusing on those in Austria – a country that offers many advantages.

The company says Austria’s onshore assets, a medium cost environment in comparison to other European regions and a gas network connected to several neighbouring countries are some of the reasons why the country presents as a compelling investment case. Excellent infrastructure and a fast and favourable regulatory process add to the appeal.

With the transition to renewable energy taking longer than expected to ramp up to the levels required to reduce the world’s reliance on “old style” hydrocarbon products, there is still a huge demand for oil and gas. So, if Welchau delivers the goods, ADX may soon find itself in pole position to meet that call.

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