Panax Geothermal discusses partnership options for Penola project

Panax Geothermal discusses partnership options for Penola project Panax Geothermal's Salamander-1 well at Penola, Australia (source: Panax)
Alexander Richter 5 Oct 2010

Panax Geothermal is optimistic on well potential of Salamander-1 at its Penola Projects and there are supposedly ongoing discussions with various parties for a potential partnership for this project.

According to news from Australia, Panax Geothermal is supposedly “in discussions with various parties for potential partnerships for its Penola geothermal project.

The company also said yesterday it was optimistic about developing its recently completed Salamander-1 well into a production well.

Releasing a final well test report from its expert advisors SKM, the explorer said results were no different from what had been reported before – with the temperature at the bottom of the well steady at 171.4C.

There were indications that adopted drilling techniques had led to the deterioration of the well bore, preventing the testing of the actual potential of the intersected reservoir rocks.

In July, Panax flagged problems at the well, saying its productivity during a testing program had not been encouraging.

At the time it had serious doubts about whether this reflected poor reservoir quality or reflected the result of massive reservoir damage incurred during drilling and testing, but there remained sufficient grounds for it to continue work at the project.

These problems are not different from those experienced by the coal bed methane (CBM) industry in the 1980s and 1990s.

New well completion techniques had helped resolve these problems, it said.

Panax has now engaged reservoir engineers who were instrumental in resolving CBM problems in Queensland and had played a role in its transformation to a multibillion industry.

“By adopting appropriate well completion techniques/methods, we are optimistic that the Salamander-1 well can still be developed into a production well,” Panax said yesterday.

The focus is now on a detailed examination of well records to develop an optimised well complettion program.

Panax Geothermal shares rose 7 per cent, or 0.3c to 4.7c yesterday.”

Source: Adelaide Now, Full release on Salamander-1 well potential (pdf)