Projects Overview

Botswana

Kalahari Basin:
Serowe CSG Project

United States

Illinois Basin, Illinois:
Overview
Unconventional Horizontal
Vertical

San Joaquin Basin, California:
Eagle Oil Project

Serowe Coal Seam Gas (CSG)- Botswana

Highlights - Serowe CSG Project Farmin

  • Serowe CSG Project is a 100% owned 680,000 acre coal seam gas project in Botswana.
  • Active second half 2018 exploration programme planned.
  • Located in the heart of the Kalahari CSG Fairway.
  • Environmental Management Plan submitted for approval that will allow Strata-X to drill and production test up to 20 wells, approval expected in Q4 2018.
  • Strata-X  has substantial land holdings within the internally mapped high-grade area. 
  • MHA Petroleum Consultants have calculated a Prospective Resources of 3.3 TCF (Trillion Cubic Feet) net to Strata-X over the Serowe CSG Prospect. (1)
  • Ample tenement term to establish production, tenement active into 2025.

ASX disclosure note - 5.28.2 - The estimated quantities of petroleum that may potentially be recovered by the application of a future development project(s) relate to undiscovered accumulations. These estimates have both an associated risk of discovery and a risk of development. Further exploration appraisal and evaluation is required to determine the existence of a significant quantity of potentially moveable hydrocarbons.

The Serowe project is located in the Kalahari Basin CSG fairway, and offsets tenements of ASX peer TLOU (ASX:TOU).  As announced on 2 January 2018, the Company pre-empted a third party offer to buy a 25% interest in those licenses totaling 273,000 acres with a 1.4Tcf Prospective Resource(1) and on March 6, 2018 the preempt transaction was closed. As of the issuance of this report, all payments related to the buy out have been made.

In January 2018, the Company’s Prospecting Licenses held in the Republic of Botswana, covering the Serowe CSG Project, were re-issued until the end of 2025 opening the door to an active 2018 appraisal programme. In March 2018, the Company acquired two new Prospecting Licenses for its Serowe CSG Project covering 406,735 acres. In total, the Company holds approximately 680,000 acres in the 100% owned Serowe Gas Project. With the addition of the offsetting prospecting licenses acquired in March 2018, the company increased the Prospective Gas Resources in the Serowe CSG Project, located within the Botswana CSG fairway, to 3.3 TCF.

Strata-X currently holds the tenements through its Republic of Botswana subsidiary, Sharpay Enterprises Pty Ltd. and Jab Right Pty Ltd.

The Company initiated environmental surveys to complete an Environmental Management Plan (“EMP”) for its 2018-2019 drilling and testing programme in February 2018 with the selection of EcoSurv Environmental Consultants of Gaborone, Botswana. EcoSurv has extensive experience in environmental management surveys and plans in Botswana in both the energy and mining arenas. In June 2018, Strata-X submitted the final EMP report, and it is expected that a final approval will be granted in the fourth quarter of 2018.  EcoSurv has completed other CSG plans which should serve the Company’s efforts well and provide a timely report for approval by the Government.

Upon approval of the EMP, the Company will move forward with an active drilling and testing programme. The appraisal program is designed to prove commercial completion methods and convert resources to reserves in a high-graded area within the CSG fairway that the Company has interpreted. Within the high-graded area, some previously drilled wells flowed or bubbled free gas from the target coal reservoir.  This can only occur with 100% gas saturations.  The target coal seam within the sweet spot ranges from 8 to over 12 metres in thickness.

To further compliment the high-graded area appraisal, the Company plans to apply the latest completion and production methods designed to yield commercial gas flow rates. The Company has access to the resources of Wellpro Services, a private Queensland based service company that are experts in CSG well completions and production methods. Wellpro has proprietary methods and equipment designed to minimize the time to commercial gas flows rates which the Company intends to apply to the target coal seam within the high graded area.  The Company also intends to use the services of QTEQ, a service company that has recently developed specialized wireline logging, to help fast track reserve certification.

The Republic of Botswana is one of the oldest democracies in Africa, becoming independent in 1966. The rule of law is well established and long-standing, and Botswana is recognized as having the lowest rate of corruption in Africa. The geography of the project area is predominantly flat with good road access. These factors, combined with a 3% government royalty on produced gas, make Botswana one of the more favorable economic settings in the world for natural resource development. The growing demand for power in Botswana and neighboring countries offers immediate and expanding domestic gas markets.

The Serowe Gas Project is an underexplored and underdeveloped opportunity, covering the coal seam gas deposit fairway in the Republic of Botswana. The economies of the Republic of Botswana and its regional neighbors are rapidly growing with energy demand poised to skyrocket. The Republic has set goals for promoting the exploration and development of natural gas resources in the county to meet these demands.

(1) Prospective Resources figures are from an audit report prepared by MHA Petroleum Consultant dated 26 October 2016 following their audit of the available technical data including the geological interpretation, information from relevant nearby wells, analogous reservoirs and the proposed program for the Project, prepared and presented to MHA by Strata-X. Stated Prospective Resource figures are Best Estimate – undiscovered natural gas quantities and net of a 9% royalty and are shown at a 100% working interest in the Project that Strata-X will only earn upon completing the farm-in program. For addition information see Strata-X November 2016 Presentation.