Galilee Energy Drills Five Shallow Oil Zones at Zydeco Starting Monday
Key Takeaways
- RFC Drilling Rig 103 is already on site at Zydeco-1, with sidetrack operations scheduled to commence Monday 28 September 2026 — no mobilisation delay.
- Five shallow oil zones are targeted: Borsum, Richie, Discorbis gravelli, First Het, and Homeseeker B, with combined 2U Best prospective resources totalling approximately 317 thousand barrels gross.
- The entire sidetrack and oil testing program is fully funded from Galilee's recently completed A$3.5 million placement, with no additional capital currently anticipated — meaning no dilution risk from this program.
- Galilee assigns a 65% chance of discovery or development to these prospective resources, which are un-risked estimates prepared under SPE PRMS 2018 Guidelines as at August 2026.
- Deeper Stafford and Tweedel gas-condensate targets remain on the roadmap for a dedicated future well, keeping Galilee's broader exploration pipeline intact beyond the current sidetrack.
Zydeco sidetrack set to begin Monday as Galilee targets five shallow oil zones
Sidetrack operations at Galilee Energy Limited’s (ASX: GLL) 100%-owned Zydeco Oil & Gas Project in Louisiana are scheduled to commence on Monday, 28 September 2026. RFC Drilling Rig 103 is already on site at Zydeco-1, removing any mobilisation delay from the program. Five shallow oil zones are in the crosshairs: Borsum, Richie, Discorbis gravelli, First Het, and Homeseeker B. The program is expected to be fully funded from Galilee’s recently completed A$3.5 million placement, with no additional capital currently anticipated.
Joseph Graham, Managing Director
“With the rig already on site and sidetrack operations scheduled to commence on Monday, we look forward to taking the next step in evaluating Zydeco’s oil potential. The original well identified five prospective shallow oil zones, opening an additional opportunity beyond our original gas-condensate objectives. Our focus now is to drill and evaluate those targets and, if successful, establish a pathway to oil production. The sidetrack and oil testing program is fully funded from our recent placement. We look forward to updating shareholders as operations progress and results become available.”
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What the sidetrack is designed to achieve
From gas-condensate well to oil opportunity
The original Zydeco-1 well was drilled with primary gas-condensate objectives targeting the Upper and Lower Tweedel formations at approximately 9,800 feet depth. In the course of that drilling, five prospective shallow oil zones were identified above the original gas targets, presenting an additional opportunity that was not part of the original program design.
The sidetrack is specifically designed to evaluate these shallow oil zones while preserving the wellbore as a potential future oil production well. Any decision to proceed to production is contingent on the results of drilling, formation evaluation, and testing. The program is not a guaranteed pathway to commercial production.
Deeper targets remain on the roadmap
The deeper Stafford and Tweedel gas-condensate objectives are not the focus of this sidetrack. The announcement confirms these remain potential targets for a dedicated future well, keeping Galilee’s broader exploration pipeline intact beyond the current program.
Understanding prospective oil resources at Zydeco
“Prospective resources” refers to estimated quantities of hydrocarbons that may potentially be recovered from undiscovered accumulations. Importantly, these are un-risked estimates: they have not been adjusted to reflect the probability that drilling will confirm commercial quantities. Galilee assigns a 65% chance of discovery or chance of development to these estimates.
Shallow oil zones carry a practical appeal for investors. Lower drilling depths generally translate to lower drilling costs and a potentially faster path to production if results are positive, compared to the deeper gas-condensate targets.
The table below presents the gross prospective oil resources for the five sidetrack target zones, drawn from the resource table in Appendix 1 of the announcement. All figures are before royalties. Estimates are un-risked and current as at August 2026, prepared in accordance with SPE PRMS 2018 Guidelines.
| Zone | 1U Low (kbbls) | 2U Best (kbbls) | Mean (kbbls) | 3U High (kbbls) |
|---|---|---|---|---|
| Borsum Sand | 54.1 | 65.0 | 68.6 | 86.6 |
| Richie Sand | 18.0 | 21.6 | 22.8 | 28.8 |
| Disc Grav Sand | 64.0 | 76.8 | 81.1 | 102.4 |
| 1st Het Sand | 40.0 | 48.0 | 50.7 | 64.0 |
| Homeseeker B Sand | 88.0 | 105.6 | 111.5 | 140.8 |
All volumes are oil only (kbbls = thousand barrels). Estimates are un-risked gross prospective resources before royalties, as at August 2026 per SPE PRMS 2018 Guidelines. A 65% chance of discovery or chance of development applies.
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What’s next for Galilee Energy investors
Near-term milestones to watch following this announcement:
- Sidetrack drilling commences: Monday, 28 September 2026
- Formation evaluation: results to follow drilling
- Oil zone testing: outcomes will determine whether a pathway to production is viable
- Shareholder updates: Galilee has indicated it will provide further updates as operations progress and material results become available, with no fixed timeline disclosed
The program is expected to be fully funded from the A$3.5 million placement, with no additional funding currently anticipated, which means no dilution risk from this specific program.
More broadly, Galilee’s stated strategy is to build a scalable US Gulf Coast oil and gas business, with the Zydeco project as its foundation. The Company also retains a 2% net overriding royalty over future production from Queensland’s Glenaras Gas Project, providing additional optionality beyond its US operations.
Investors should note that the scheduled commencement date and planned activities remain subject to final engineering approval, applicable regulatory requirements, and normal operating conditions. Drilling and testing outcomes are uncertain, and there is no assurance the program will establish a commercially recoverable hydrocarbon accumulation.
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