HIGHLIGHTS
Drilling safely reached total depth (TD) of 1,044m MD without incident
Wireline logs completed using full GR, Sonic, Resistivity, Density and Neutron tools
Petrophysical analysis confirms hydrocarbons in Upper Sawpit Sandstone
Low permeability observed
Well cased and suspended for future production
Stimulation options under review
Workover rig planning to test KN2 and DW1 performance
Red Sky Energy Ltd (Red Sky or the Company) advises that drilling operations at the Killanoola2 (KN2) oil appraisal well, located in PRL-13 in South Australia’s onshore Otway Basin, have been safely
completed and the well has been cased and suspended with production pipe run as a potential future
producer.
Following the overnight acquisition of neutron-density logs, Red Sky’s petrophysicist completed a detailed
petrophysical interpretation. The analysis confirms the presence of hydrocarbon-bearing zones in the Upper
Sawpit Sandstone, albeit with limited production potential in its current unstimulated state.
The evaluation concluded that KN2 exhibits very similar characteristics to prior wells (K1, K1DW and K1SW1),
with low matrix permeability, high water saturations and a high degree of shale interbedding. These factors
reduce connectivity within the reservoir.
As such, and in line with the recommendation, the Company has elected not to proceed with the contingent
Drill Stem Tests (DSTs). A wiper trip was conducted, and the well has now been cased and suspended as a
potential future producer.
Red Sky Energy Managing Director, Andrew Knox, commented:
“We have advanced KN2 safely and efficiently, and now have two suspended wells that correlate closely to the
3D seismic model. Our next priority is testing the production potential through a fit-for-purpose completion
and possible stimulation plan. We remain optimistic about unlocking value at Killanoola through targeted,
regulatory-compliant artificial lift and stimulation.”
Forward Plan
Red Sky intends to:
• Complete both KN2 and the nearby DW1 well using a workover rig, and
• Evaluate the potential for stimulation, subject to regulatory approval.
The Company is reporting Total Petroleum Initially In-Place (PIIP) consistent with the SPE-PRMS classification
framework under Listing Rule 5.25.3. The PIIP figures are sourced from the Company’s announcement dated 21
April 2023, which includes an independent Competent Person’s Report. These estimates are classified as
prospective resources and are un-risked.
The estimates presented were derived using a deterministic method and represent un-risked best estimates. The
aggregated values are arithmetic sums of individual reservoir estimates and do not reflect statistical aggregation.
No adjustments have been made for the chance of commercial development or discovery, and the reported
prospective resources remain subject to significant technical and commercial risk.