Omega Oil and Gas (ASX:OMA) has begun drilling Canyon-3, the first well in its fully funded 2026–27 appraisal program in Queensland’s Taroom Trough.
The campaign comprises four vertical appraisal wells, followed by one or two horizontal wells extending up to 2,000m. The horizontal drilling is contingent on well results and land access.
Located 10km southeast of Canyon-1H, Canyon-3 will test the lateral and vertical extent of the Canyon Sandstone and other stacked Permian reservoir intervals.
Omega plans to drill the well to a total measured depth of about 3,900m, with the top of the Permian section expected at approximately 3,200m.
The company says previous drilling identified five hydrocarbon-bearing Permian reservoir layers and traced Canyon Sandstone continuity over more than 40km.
Canyon-1H returned a normalised production rate of 987 barrels of oil per day and 1.45 million standard cubic feet of gas per day. The rate was normalised to a 2,000m horizontal section.
CEO Trevor Brown says the new campaign will assess whether reservoirs of similar quality extend across Omega’s acreage.
“Our 2026/27 campaign aims to take the next step, by proving that oil and gas bearing reservoirs of similar quality are widespread across our acreage area,” Brown says.
Omega says it plans to combine results from Canyon-3 and Canyon-4 with Canyon-1, Canyon-2, and 2D seismic data. The company notes the work aims to establish whether oil-bearing Canyon Sandstone extends across approximately 200km² between the existing Canyon wells and the Cabawin Oil Field.
Modelling by SLB (NYSE:SLB) indicates the area could support about 75 horizontal development wells targeting a single reservoir layer. SLB estimates a 2,000m well could recover approximately 0.95 million barrels of oil equivalent over 10 years.
Omega says it expects to report Canyon-3 results in late August 2026. Results from the other vertical wells are anticipated at approximately monthly intervals, followed by an updated resource and reserve assessment in late 2026.
Write to France Pinzon at Mining.com.au
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