RED SKY ENERGY LIMITED Red Sky Energy released results from a report by Global Resources & Infrastructure Pty Ltd. (GRI) that provides an updated Independent Competent Person's Report (CPR) on the discovered Petroleum Initially In Place (PIIP) in the Killanoola Oil Project, PRL-13, Penola Trough, South Australia (the Petroleum Asset), held by Red Sky for an effective date of 31 March 2022. As previously reported in ASX Release on 22 March 2021, petrophysical analysis had identified sixteen (16) metres of Net Pay in the Killanoola SE-1 well. Subsequent to that release the Company advised on 6 May 2021 that a new petrophysical analysis had identified an additional thirty seven (37) metres of potential Net Pay in the Killanoola-1 DW-1 well.
This was in addition to the existing 5 metres of proven pay. The newly estimated Discovered PIIP values below take into account the additional net pay identified in the wells Killanoola SE-1 and Killanoola-1 DW-1. This evaluation has been carried out in accordance with the Petroleum Resources Management System (PRMS) approved in 2018 by the Society of Petroleum Engineers, the World Petroleum Council, the American Association of Petroleum Geologists, and the Society of Petroleum Evaluation Engineers. The report has been prepared and supervised by the Competent Person.
As required, to remain compliant with PRMS (2018) when using the deterministic method, GRI has determined Low/Best/High volumes to represent the discovered PIIP. These estimates were developed using various changes to the size of the structural compartments as interpreted. GRI has calculated that the Low estimate of 57.2 mmbbls should be represented by what the company have described as the small-mapped closures of Killanoola-1, Killanoola-1DW-1, Killanoola S-1 and Killanoola SE-1. GRI chose structural compartments that have discovered oil to represent the Best estimate of 93.0 mmbbls oil volumes as the company is aware from drilling that several structural compartments have discovered oil and the company have added structural compartments that have potential to contain oil to represent the High volumes of 98.6 mmbbls.
In December 2021 a successful fluid sampling operation was carried out at Killanoola-1 DW-1. Subsequent laboratory tests have indicated that the Killanoola crude has a maximum pour point of 36 degrees Celsius, which is indicative of a highly waxy crude. To account for the risk of the presence of high paraffinic content in the reservoir on the oil recovery, the company have revised the recovery factor downward from 40% to 30%. PRL-13 covers a total area of 17.5 km2 and is located nearby to the Haselgrove and Jacaranda Ridge Gas Fields and approximately 25 km NW of the Katnook Gas Fields and processing facility.
First discovered in 1998, the Killanoola oil field was discovered by the Killanoola-1 well at a depth of 850 metres. Red Sky has advised that previous flow tests have recorded rates of up to 300 barrels of oil per day. In 2011, the second well Killanoola Southeast-1 was drilled within the PRL-13 area and discovered oil.
In 1998 the Killanoola-1 DW-1 well was drilled, it also discovered oil. Work on a market for the crude is underway and planning has commenced to contract a rig and for the wireline perforation of the additional zones of interest identified at both DW1 and SE1. This is to be followed by production testing and potentially long-term production.
