This story was originally published in The West Australian on 5 April 2018 with the headline "Quadrant rig watched by investors." © Peter Milne.
A rig has arrived off the North West to drill the first of two wells for Quadrant Energy which potential investors will monitor closely in coming months.
The Phoenix South and Dorado gas and condensate prospects, and nearby Roc in the Bedout Basin north of Port Hedland, are operated and 80 per cent owned by the privately owned producer.
Carnarvon Petroleum holds the remainder.
Carnarvon managing director Adrian Cook said drilling Phoenix South would take about 90 days, with the two wells to help determine the resources available for the three prospects to be developed together.
An offshore facility could export the condensate and pipe the gas either directly to Port Hedland or to Karratha via the Woodside-led North West Shelf venture’s existing infrastructure, according to Carnarvon’s latest investor presentation.
Transocean’s Development Driller-1 semi-submersible rig will drill an appraisal well in Phoenix South, discovered in 2015. Carnarvon yesterday reported its arrival.
Next month an Ensco 107 jack-up drilling rig will start on the yet to be drilled Dorado prospect.
The Development Driller-1 will go on to drill two wells at Quadrant’s Van Gogh oil field, 47.5 per cent of which is held by Japan’s Inpex.
A float of Quadrant Energy has reportedly been shelved but major shareholder Brookfield Asset Management is looking to offload its equity.
Potential buyers will be interested in the producer’s supply to about 20 per cent of the State’s domestic gas market as well as any upside from the Bedout Basin.
While gas prices in WA are low, a possibly tighter market early next decade is encouraging investor interest.
Equity in Quadrant could be considered the best way for investors to gain from any gas price rises in the State.