Here’s why the Strike Energy (ASX:STX) share price surged 18% today

Oil and gas prices are forecast to remain elevated during the global reopening.

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The Strike Energy Ltd (ASX: STX) share price is going gangbusters today, currently up 14.6% at 17 cents apiece after rocketing out of the opening gates with an early 18% surge.

Below, we take a look at the ASX oil and gas explorer’s field update that looks to be spurring investor interest.

What gas field update was announced?

The Strike Energy share price is off to the races after the company reported “high-quality, low CO2, conventional gas accumulation” at its suspended Walyering gas field, located in the Perth Basin.

Strike said its Walyering-5 (W5) well results delivered a higher quality reservoir than it had expected, along with revealing additional gas pay in deeper sands. It has confirmed 4 gas charged reservoirs with a total gross thickness of 116 metres and total net pay of 51 metres. Peak porosities were reported at 21.5% with an average porosity of 15.4%.

Commenting on the results, Strike Energy’s CEO, Stuart Nicholls said:

The results of the Walyering-5 well have exceeded Strike’s pre-drill expectations with thicker and better-quality gas charged sands being encountered across several reservoirs. These results are another example of the excellent geoscience outcomes that the Strike team continue to deliver, and this result bodes well for ongoing success throughout the basin.

The co-location of the Walyering gas field with transmission infrastructure, better than pipeline quality gas and position on free-hold land, combines to make the potential for a very fast to market domestic gas development.

Strike Energy is the operator and the holder of a 55% joint venture (JV) interest in the project. Talon Energy (ASX: TPD) holds the other 45%. The Talon Energy share price is flat at time of writing.

Looking ahead, Nicholls said Strike and Talon would now come up with a plan for a fast, low-cost development. They also intend to have the resource independently certified.

Strike Energy share price snapshot

Despite today’s big leap, the Strike Energy share price remains down more than 40% in 2021. By comparison, the All Ordinaries Index (ASX: XAO) is up 8% year-to-date.

Over the past month, Strike Energy shares have gained 6%.

The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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