L&M Energy Limited (LME) provides the following update on the completed OM-4 well located in PEP 38220 (Ohai) on the South Island of New Zealand.

Following the successful completion of coring operations and subsequent suspension as a future production well, gas desorption testing of cores obtained from the well to date indicate that the Morley formation coals contain gas contents of up to 11m3 (dry ash free) per tonne of coal with isotherm testing confirming that the coals are fully saturated with gas. Gas composition is also excellent with methane levels between 97-99%.

These results further support the existence of additional gassy Morley coals extending into the Company's adjoining permit PEP 38226 (Waiau), not currently included in the 173PJ of 3P reserves independently certified late last year.

With the Company having successfully concluded its recent capital raising, pre-well planning is now underway for the drilling of a CSG pilot production project in the Ohai permit, scheduled to begin in September, with a view to the Company certifying the first tranche of 2P CSG reserves early in the new year.

Tags: L&M Petroleum Limited