Omega Oil & Gas Extends Taroom Trough System With Canyon-3

Omega Oil & Gas (ASX: OMA) has strengthened the case for a large oil and gas system in Queensland’s eastern Taroom Trough after its first 2026/27 appraisal well intersected six oil and gas-bearing Permian reservoirs.

Canyon-3 reached 3,792.6 metres and returned a 526-metre oil and gas-bearing interval. That interval contained 170 metres of aggregate net pay. The primary Canyon Sandstone target outperformed the equivalent interval in Canyon-1 by a wide margin.

The well encountered 18 metres of net oil-bearing sands averaging 11.5% porosity within a 42-metre gross Canyon Sandstone interval. That made the reservoir 14% thicker with 55% higher porosity than at Canyon-1.

Omega also identified enhanced reservoir properties in the overlying Lower Kianga Sandstone. The company now interprets that zone as a sixth regionally extensive reservoir layer across its acreage. The Kianga was previously considered a secondary target.

Canyon-3 was drilled about 9 kilometres southeast and 275 metres updip of Canyon-1. The location was chosen to test the lateral continuity of stacked reservoirs and hydrocarbon distribution toward the Cabawin Oil Field.

Surface and wireline logging showed oil, gas and condensate distributed through the Permian sequence. Oil fluorescence was observed in drill cuttings across all six reservoir intervals.

The Canyon Sandstone has previously demonstrated oil and gas flow at Canyon-1H. That well delivered 987 barrels of oil per day and 1.45 million standard cubic feet per day, normalised to a 2,000-metre horizontal well.

“We saw thicker and better reservoirs in Canyon-3 compared to previous wells and proved continuity of the geology in target reservoirs, further confirming our geological model,” chief executive officer Trevor Brown said.

“The Canyon-3 well has also highlighted the potential of an additional reservoir interval in the Lower Kianga, which adds to the five stacked, regionally extensive reservoirs that we map across our acreage [and] provides further optionality.”

Results indicate the Canyon Sandstone extends at least 20 kilometres east-west from Canyon-1 through Canyon-3 toward the Cabawin oil field. Regional well data indicate continuity for more than 40 kilometres north-south from Canyon-2 to Tasmania-1 and another 40 kilometres northwest to Fantome-1.

Canyon-3 and the planned Canyon-4 well are expected to provide additional control across more than 200 square kilometres. Later Canyon North-1 and Canyon North-2 wells are intended to extend evidence for the resource system further north.

SLB modelling based on Canyon-1 and Canyon-1H data indicates what a single development well could deliver. A 2,000-metre horizontal well at 1,000-metre spacing in the Canyon Sandstone could produce an estimated 10-year ultimate recovery of about 0.95 million barrels of oil equivalent, or 5.72 billion cubic feet of gas equivalent.

On that basis, a 200-square-kilometre area could support about 75 horizontal development wells using 2,000-metre laterals at 1,000-metre spacing. That works out to roughly one well per 2.5 square kilometres.

Omega plans to use data from its 2026/27 program to test and refine that interpretation. The goal is to determine how widely the reservoir characteristics demonstrated in previous wells persist across the broader Canyon Project.

The drilling rig is moving to Canyon-4. Drilling is expected to begin in about seven days, with results targeted for late September.

Omega’s current program comprises four vertical wells followed by one or two horizontal wells with flow tests. The design is meant to further assess reservoir scale and quality, fluid distribution, and the potential for repeatable commercial flow rates.

Data from Canyon-3 will now be integrated with existing well and seismic datasets as Omega works to reduce subsurface uncertainty and mature its resource base.

Omega remains fully funded for the 2026/27 appraisal program. Canyon-4 provides the next step in testing whether the reservoir characteristics seen at Canyon-3 persist across the broader Canyon project.