The Vintage Energy Ltd (ASX: VEN) share price surged today, closing 9.3% higher at 9.4 cents at the end of trade. This came after the company announced "highly successful" flow test results from its Vali-1 ST1 joint venture.
Vintage Energy is a natural gas exploration and development company that was formed to address the natural gas shortage in Eastern Australia. It has been listed on the ASX since 2018.
What were the results?
The company reported that the flow test program for its Vali-1 ST1 joint venture had been successfully completed. The two-day test measured a stabilised flow rate of 4.3 MMscfd through 36/64" choke at 942 psi.
Vintage Energy, which holds a 50% stake, said the all flow test objectives were achieved, with data now being analysed to enable reserve assessment.
"As a consequence of the flow testing of the well, our initial estimates of the potential gas flow rate for the Vali-1 ST1 well are in excess of 5MMscfd," the company said.
Operator and 25% joint venture partner Metgasco Limited (ASX: MEL) said information from the testing would be assessed and incorporated into a commercialisation plan for the asset. This would include an estimate of the number of development wells required to efficiently produce gas and maximise returns from the Valie Field.
The company said the joint venture contained an independently verified, gross 2C contingent resource of 37.7 Bcf or 9.4 Bcf Net.
Metgasco CEO Ken Aitken said: "I look forward to the rapid analysis of the data gathered to enable reserves to be booked and, subject to successful gas sales and tariff discussions, the JV proceeding to a development decision."
About the Vintage Energy share price
At 30 June 2020, Vintage Energy had cash of $3,443,239 up from $2,597,761 at the end of the previous quarter.
The company raised $0.75 million in May 2020 through a share purchase plan and $2.25 million from a placement. The issue price was 3.6 cents per share.
The Vintage Energy share price is up 148.65% since its 52-week low of 3.7 cents. However, the share price is down 48.89% since the beginning of the year and down 34.29% since this time last year.
