CH4 - Moranbah Gas Project – Case Study

Client Background

CH4 is an Australian energy company and was established in May 2000 to explore for, develop and produce coal seam gas. The company has a project agreement with BHP Coal giving it exclusive rights to explore for and develop gas within BHP’s exploration lease at Moranbah in regional Queensland, Australia

CH4 floated on the Australia Stock Exchange in early 2004.

Project Overview

Mitchell Drilling approached CH4 when it was first investigating the best approach to exploring and producing gas at the Moranbah Gas Project. Mitchell Drilling's commitment to the development of technology and drilling methods secured us the contract and a three year, ongoing relationship began.

The Moranbah Gas Project is an unusual project in its complexity, location, and ground conditions. Mitchell Drilling were challenged by the client to come up with the best and most efficient drilling techniques available to suit this site.

At the time Mitchell Drilling's was investing heavily in engineering and hardware resources to achieve what was to resul in the creation of the Dymaxion surface-to-inseam drilling method - a process which has since revolutionised the CBM industry.

We drilled a pilot program for CH4, the results of which allowed CH4 to win the Townsville Power Station gas contract which spans 15 years and is worth 500 million dollars.

Mitchell Drilling then began drilling at the Moranbah Gas Project for Phase 1 of the project that saw 103 directional wells drilled.

This project called for dedicated drilling rigs that were designed especially for the project. The multiple discipline rigs include surface casing rigs, vertical production rigs, and horizontal in-seam rigs. By having rigs specialised for certain sections of the well, we have created a previously unseen efficiency that has become a model for future projects and set new innovation standards within the industry.

In conjunction with the clients technical team, all the well engineering for this project was done by Mitchell Drilling, including well modelling, flow characteristics, torque and drag and investigation of the positives and negatives of under-balanced versus controlled balanced drilling techniques.

Now drilling Phase 2 is underway and we are negotiating for Phase 3 of the project which will see Mitchell Drilling rigs continuing on for another three - five years.