HIGHLIGHTS
• Drilling commenced at well 271-KV06PT, the second well in the five production well
test program
• Initial gas flow results from 271-06PT are expected in November 2024, providing
critical data on gas flow rates and depletion curves
• The location is just 41m away from KV-06C core, which had 86.5m of gassy sandstone
between 360-630m and coals which desorbed over 7m³/tonne gas.
• Production test program will flow-test each well for up to 90 days, gathering essential
data for the certification of reserves and future development clusters
• Wells are strategically located near key energy infrastructure optimising the
program's commercial potential and delivery of gas to off-takers
Kinetiko Energy Ltd (Kinetiko or the Company) is developing an energy solution for South Africa
focused on commercialising 100% owned advanced shallow conventional gas projects in the Mpumalanga
Province. Kinetiko is pleased to announce the spudding of well 271-06PT, the second well in the Company’s
five-well production test program. Drilling commenced on 24 October 2024, and the well is located near
essential energy infrastructure, including the Lily pipeline. This well represents a key milestone in the
Company’s ongoing efforts to commercialise its advanced shallow conventional gas projects, which are
poised to deliver cleaner, reliable energy to a nation facing critical shortages.
The five-well production test program is expected to provide significant insights into the reservoir dynamics
of Kinetiko's 100% owned gas fields. With South Africa urgently needing alternative energy solutions, this
program is a critical step toward unlocking the potential of the Company’s 6 TCF (2C) contingent resource,
discovered across Kinetiko’s expansive onshore tenement package.
Kinetiko Executive Chairman Adam Sierakowski commented:
"The spudding of our second well in this five-well production test program is ahead of schedule. We
continue our search to demonstrate the commercial viability of our vast gas resources and
contributing to South Africa’s urgent need for cleaner, more reliable energy solutions.
Well 271-KV06PT is located in an area adjacent to the Lily pipeline, and is well positioned to deliver
gas to key infrastructure. We expect this test program to provide invaluable data on flow rates and
depletion curves. These results will underpin the expansion of our gas reserves and pave the way for
future production clusters."
Key Milestones and Program Timeline
Drilling of the second well, 271-KV06PT with completion and initial gas flow results anticipated in November
2024. The program involves drilling five production test wells, each expected to be completed within 4
weeks. After drilling, each well will undergo an extended dewatering and gas flow testing process, for up to
90 days to determine flow rates and depletion curves.
The data gathered will be instrumental in certifying gas reserves, estimating the life of future production
clusters, and optimising Kinetiko’s gas field development plans.
Production Well Program
The production test program will individually flow-test each of the wells for an extended period. This process
is designed to capture critical data on flow rates, reservoir pressure, and depletion curves, which will then
be used to model the economics of future gas field developments. Based on prior reserves calculations, a
flow rate of 50,000 SCF/day has been assumed, with the aim of exceeding this threshold and significantly
improving the project's commercial metrics.
Each of the production test wells are located near essential infrastructure, including gas pipelines and
transmission lines, further positioning Kinetiko as a potential major supplier to South Africa’s power grid.
The Company will regularly update the market on the drilling and flow testing results of each individual
well as it progresses through the program.
Projected Resource Growth and Future Plans
Kinetiko's existing 6 TCF (2C) contingent resource, equivalent to 1 billion barrels of oil, is expected to grow
significantly as a result of the current five-well testing program, all of which will be hundreds of meters
deeper than completed tests to the north. Each well has been carefully positioned based on successful
results from prior exploration, which identified extensive gassy pay zones. The results of this program will
also aid in converting a portion of the Company's 5.8 TCF of 2U Prospective Resources into contingent
resources.
The success of this program will further de-risk future drilling campaigns and accelerate Kinetiko’s efforts to
become a major contributor to South Africa’s evolving energy landscape.
