Elixir Energy Restarts Lorelle-3H Flow Test With Maiden Gas Reserves Booking in Sight
Key Takeaways
- Elixir Energy has commenced the second phase of Elixir Energy Lorelle-3H flow testing following a deliberate 60-day reservoir soak, with the explicit goal of generating data to support a maiden Reserves booking.
- Initial clean-up flows in July 2026 peaked at 10.4 mmscfd with light oil/condensate, comparing favourably with other horizontal wells in the Taroom Trough — and were achieved while still producing 800 bbls/d of stimulation fluid from only ~1,000m of reservoir.
- Lorelle-3H is co-located with the proposed Warkon Pilot and sits approximately 55 km from the Wallumbilla Gas Hub, positioning it as a potential foundation production well if flow testing succeeds.
- Qualifying well costs for Lorelle-3H are eligible for up to a 48.5% refund under the Federal Government's R&D Tax Incentive, materially reducing the effective cost of the appraisal program.
- Elixir holds ~3.5 TCF of independently certified 2C Contingent Gas Resources in the Taroom Trough and has a gas-to-market pathway de-risked through a partnership with APA Group, one of Australia's largest gas infrastructure operators.
Lorelle-3H enters critical flow testing phase with reserves booking in sight
Elixir Energy has commenced the second phase of flow testing at the Lorelle-3H appraisal well, following a deliberate 60-day reservoir soak after encouraging initial clean-up flows completed in July 2026. This phase of testing is specifically designed to generate the technical data required to support the company’s maiden Reserves booking.
The strategic stakes are significant. Subject to a successful test, Lorelle-3H has the potential to become a foundation production well for the Warkon Pilot, positioned approximately ~55 km from the Wallumbilla Gas Hub — the major wholesale gas trading hub in eastern Australia.
When big ASX news breaks, our subscribers know first
What the 60-day soak means — and why the initial flows were encouraging
Initial clean-up flow performance
The Lorelle-3H well completed a 30-day clean-up flow period in July 2026, with results described as comparing favourably with other horizontal wells drilled in the Taroom Trough. Key flow rate data from that period:
The Lorelle-3H drilling results established the well’s credentials as an outlier within the Taroom Trough, with net pay intersected and stimulation volumes that set a new benchmark for horizontal appraisal activity in the formation.
- Peak rates: 10.4 mmscfd with 10 bbls/d of light oil/condensate (approximately 10.5 mmscfd / ~13 TJ/d gas equivalent)
- 1-hour average: 6.2 mmscfde (~7.5 TJ/d)
- Most stable 12-hour period average: 2.35 mmscfd with 6 bbls/d condensate (~2.4 mmscfde / ~3 TJ/d)
- Peak rates were achieved while still producing 800 bbls/d of stimulation fluid from only approximately 1,000m of reservoir, on a 40/64″ choke with 2,000 psi flowing wellhead pressure (FWHP) — indicating further productivity is likely as fluid rates naturally decline
Why the well was soaked
Following these initial flows, Elixir elected to shut in the well for a 60-day soak. Three technical observations from the well supported that decision:
- Presence of dehydrated clays in core
- Improving productivity during short shut-in periods
- The well was still producing stimulation fluid when it was last shut in
Understanding reservoir soaking — what investors need to know
A “reservoir soak” (or shut-in soak) is a deliberate technical step used in tight gas and sandstone appraisal wells. Rather than continuing to flow the well immediately, the operator shuts it in for an extended period to allow conditions within the reservoir to stabilise.
During the soak, stimulation fluid redistributes through the reservoir, hydrated clays can stabilise, and reservoir pressure equilibrates. The practical effect, when conditions are right, is that the well produces at higher and more sustained rates when it is reopened.
For investors, the soak is not a delay. It is a calculated intervention designed to maximise the quality and reliability of flow data — data that directly underpins the methodology used in a formal Reserves assessment. Better data collected now means a more defensible Reserves booking later.
The next major ASX story will hit our subscribers first
The path to maiden Reserves and the Warkon Pilot
This phase of post-soak flow testing has four specific objectives:
- Establish the sustained deliverability of the Dunk reservoir
- Assess the impact of the 60-day soak on well productivity
- Obtain additional reservoir pressure and flow performance data
- Generate the technical data required to support Elixir’s maiden Reserves booking
Subject to successful flow testing and a Reserves assessment, Lorelle-3H has the potential to become a foundation production well for the Warkon Pilot. Lorelle-3H is co-located with the proposed pilot, meaning its position within the acreage is a strategic asset, not coincidental.
The gas-to-market commercialisation pathway for the Taroom Trough project has been de-risked through a partnership with APA Group, one of Australia’s largest gas infrastructure operators, giving the Warkon Pilot clear access to pipeline connectivity ahead of any Reserves booking.
On the capital efficiency side, qualifying well costs associated with Lorelle-3H — covering drilling, coring, logging, analysis, completion, stimulation, and testing — are eligible for up to a 48.5% refund via the Advanced Finding that Lorelle-3 has qualified for under the Federal Government’s Research and Development (R&D) Tax Incentive and tax return process. R&D Tax Incentive is a government programme that refunds a portion of eligible research and development expenditure, reducing the effective cost of appraisal activities.
Elixir holds a broader position in the Taroom Trough that provides important context for what a successful test result could mean. The company is the largest acreage holder in the Taroom Trough, holds approximately ~3.5 TCF of independently certified 2C Contingent Gas Resources (2C Contingent Gas Resources refers to the best estimate of gas that is potentially recoverable but not yet classified as Reserves), and sits approximately ~55 km from the Wallumbilla Gas Hub, with access to multiple gas pipelines and nearby LNG export infrastructure. Santos Limited holds the remaining 50% of the permit.
The company will provide further updates as post-soak flow testing progresses.
Lorelle-3H well snapshot
| Parameter | Detail |
|---|---|
| Well | Lorelle-3H (ATP2056) |
| Horizontal sidetrack length | 1,157m |
| Net pay intersected | 1,033m (Tinowon ‘Dunk’ Sandstone) |
| Stimulation | 6 million lbs proppant, 12 stages |
| Distance to Wallumbilla Hub | ~55 km |
Don’t Miss the Next ASX Energy Breakthrough
Big News Blast delivers FREE breaking ASX energy and mining news directly to your inbox within minutes of release, complete with in-depth analysis already done for you. Join 30,000+ subscribers who stay ahead of the market the moment news breaks. Click the “Free Alerts” button to start receiving real-time alerts today.