Omega Oil and Gas (ASX:OMA) has reported strong oil and gas flow rates from its Canyon-1H horizontal well in Queensland’s Bowen Basin, confirming a significant liquids discovery in addition to the project’s existing gas potential.
The test well achieved peak flows of 452 barrels of oil per day (BOPD) and 0.6 million standard cubic feet per day (MMSCFD) of gas from a 650m lateral section of the Canyon Sandstone. Sustained 24-hour rates reached 321 BOPD and 0.472 MMSCFD. Based on these results, Omega estimates full-length 2000m development wells could produce up to 987 BOPD and 1.45 MMSCFD.
Oil recovered from the well was 49.5 API light crude—comparable in quality to oil produced in nearby Queensland fields. The company noted that strong reservoir pressure, negligible impurities, and rapid well clean-up allowed high-quality data to be collected earlier than expected.
“This is a major step forward for Omega,” said Managing Director Trevor Brown. “We were targeting gas, but the oil discovery provides huge upside and opens up two distinct commercialisation pathways.”
The well was designed as a proof-of-concept gas test, but results exceeded expectations for both hydrocarbons. The company now plans to accelerate its development timeline, with a resource update and further delineation wells expected in the second half of 2025.
Chief Technology Officer Darryl Tompkins of Revo Testing Technologies, Omega’s US-based well testing advisors, said the results were comparable to those from top-tier unconventional oil basins in the United States.
Omega has shut in the Canyon-1H well and is monitoring pressure build-up, while also evaluating options for extended production testing.
Despite the positive announcement, shares are trading 14.77% lower at 38 cents.
