The Strike Energy Ltd (ASX: STX) share price is rising today after the company advised results from its gas exploration projects in Western Australia have been "above expectations".
At the time of writing, the Strike Energy share price has lifted 4.5%, trading at 34.5 cents per share.
Strike Energy is principally engaged in the exploration and development of oil and gas resources in Australia. It primarily focuses on the Southern Cooper Basin Gas Project, Perth Basin, and West Erregulla, where the company's announcement regards today.
The West Erregulla gas field is one of Australia's most prominent and has been consistently explored since 1990. Its located in the northern-Perth basin, which makes extraction and transportation relatively lucrative.
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What Strike Energy's results say
Strike is reporting on its WE4 well, which is its fourth gas exploratory well. It runs this well as part of a joint venture with Warrego Energy (ASX: WGO) in the West Erregulla territory.
WE4 has reached a final depth of 5,069 metres measured depth (MD) with wireline logging ongoing. Measured depth refers to the distance along the borehole, as opposed to total vertical distance. Wireline logging refers to the electrical instrumentation used to measure the borehole's formation accurately.
Overall results are above Strike Energy's expectations, with initial wireline logs and petrophysics across the primary targets indicating porosities of up to 19% and reservoir pressures at 4,898 metres MD of 6,821 pounds-per-square-inch. Porosities generally refer to the amount of potential gas-containing holes, otherwise known as porosity, of the area that's being drilled.
Strike Energy's report also revealed that no gas water contact had been encountered, which deepens and extends the field's areal extent.
What this means for investors
Strike Energy is currently drilling through Kingia sandstone in the area, looking for gas deposits. Over the past two years, it has encountered strong results.
Its report states that the Kingia material it's drilling through comprises several large units of clean sand, with thick, blocky porosity development and bands of high-quality reservoir.
The Kingia has high gas saturation throughout and is interpreted to have net pay (high production depth) of 28 metres, with an average porosity of 11% across this section and up to 19%.
Strike Energy concluded its report by outlining what it believes the current results mean:
The combination of measured gas at high pressure and excellent reservoir characteristics in the Kingia supports the potential for high flow rates when production tested.
Strike Energy share price snapshot
The Strike Energy share price is close to its highest level in the past 12 months, after rising from 11 cents per share a year ago to more than 34 cents today.
Strike has been a consistent climber and increased steadily to 35 cents in January this year. It has since remained above 29 cents.
Overall, the Strike Energy share price is up 165% over the past 12 months, beating the energy sector by 138%.
