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 526m oil and gas-bearing interval containing 170m of aggregate net pay, with the primary Canyon Sandstone target outperforming the equivalent interval in Canyon-1.

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

Omega also identified enhanced reservoir properties in the overlying Lower Kianga Sandstone, which it now interprets as a sixth regionally extensive reservoir layer across its acreage.

Geological Model Strengthened

Canyon-3 was drilled about 9 kilometres southeast and 275m updip of Canyon-1 to test the lateral continuity of stacked reservoirs and hydrocarbon distribution towards the Cabawin Oil Field.

Surface and wireline logging showed oil, gas, and condensate distributed through the Permian sequence, while 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, which delivered 987 barrels of oil per day and 1.45 million standard cubic feet per day, normalised to a 2,000m 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.”

Scale Case Broadens

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

Canyon-3 and the planned Canyon-4 well are expected to provide additional control across more than 200km², while 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 a single 2,000m horizontal development well at 1,000m spacing in the Canyon Sandstone could deliver a 10-year estimated ultimate recovery of about 0.95 million barrels of oil equivalent, or 5.72 billion cubic feet of gas equivalent.

On that basis, a 200km² area could support an indicative inventory of about 75 horizontal development wells using 2,000m laterals at 1,000m spacing, equivalent to about one well per 2.5km².

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

Next Wells to Test Continuity

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

Omega’s current program comprises four vertical wells followed by one or two horizontal wells with flow tests, designed 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, with Canyon-4 providing the next step in testing whether the reservoir characteristics seen at Canyon-3 persist across the broader Canyon project.