WA gas find tipped as biggest since 1960s

Junior producer AWE has claimed a new gas discovery in the Mid West could be the largest conventional onshore gas discovery in Western Australia in 50 years.

AWE shares jumped almost 14 per cent at 10.45am WST to $1.91.

The potentially huge discovery east of Dongara comes on the back of AWE’s announcement earlier this month that it and partner Origin Energy had made a significant gas discovery at its nearby Senecio gas field, also in the Perth Basin.

AWE estimates it can quickly bring 360 billion cubic feet of gas from both Senecio and the new find at Waitsia into production using existing gas plant and pipeline only seven kilometres away.

The company has suspended its Senecio-3 well to prepare for flow testing of multiple reservoir intervals in both fields, which it estimates could hold as much as 1.17 trillion cubic feet of gas.

AWE managing director Bruce Clement said the discovery was a great result for all Western Australians, as the project fed into the domestic gas market.

“AWE believes the Senecio-Waitsia discovery could represent the largest onshore conventional gas discovery in WA since the Dongara gas field discovered in the 1960s,” Mr Clement said in a statement.

“(It) has opened up an exciting new and substantial gas play in the north Perth Basin.

“We are now focusing on flow testing of Senecio-3 to establish commercial viability and the potential early, low-cost development of the Senecio and Waitsia fields.

“If successful, this could deliver significant additional gas into the WA domestic market and provide substantial value to AWE shareholders.”

AWE is the operator and has a 50 per cent stake in the L1/L2 permit in the north Perth Basin, with Origin Energy owning the remaining half.

It produced 5.6 million barrels of oil equivalent in 2013-14, reporting a net profit after tax of $62.5 million.

It has shares in producing oil, gas and condensate assets in WA, South Australia, New Zealand and the US.