The Galilee Energy Ltd (ASX: GLL) share price has been a very strong performer on Thursday.
At one stage the coal seam gas exploration and production company’s shares were up as much as 50% to a record high of 92 cents.
The Galilee Energy share price has since pulled back but remains a sizeable 20% higher at 73 cents.
Why is the Galilee Energy share price rocketing higher?
Investors have been scrambling to buy Galilee Energy shares on Thursday following the release of an update on its Glenaras Gas Project in the Galilee Basin in Queensland.
According to the release, the Glenaras multi-well pilot has reached 50 thousand standard cubic feet per day (mscfd). This is the highest measured gas rate thus far.
In addition to this, management advised that all eleven wells are on continuous production and performing strongly.
Another positive in the update is that water rates at the laterals have declined significantly from their peak rates. Pleasingly, they are continuing to decline as the company de-pressures the pilot area and gas production increases.
What is the Glenaras Gas Project?
The Glenaras Gas Project is located in ATP 2019, which is 100% owned and operated by Galilee. This permit covers an area of approximately 3,200 km squared.
The company notes that the project has one of the largest contingent gas resources on the east coast. It believes it is strongly positioned to supply the AEMO’s forecast eastern Australian domestic market gas shortfall in the early 2020s.
But it won’t stop there. The project’s independently derived and certified contingent resource within the Betts Creek coals provide sufficient gas supply to fulfil approximately 25% of eastern Australian domestic market needs for over 30 years.
Today’s gain means the Galilee Energy share price is now up a sizeable 30% since this time last year.