Background of the TMS
The TMS is an over pressured and naturally fractured unconventional oil play. It is “on trend” with the Eagle Ford shale in Texas USA, in that it has similar depositional history and age.
Whilst still in the appraisal phase, over 80 horizontal wells have been drilled in the TMS which has helped delineate the high performing area or the core of the play. Australis operates and produces from 31 of these previously drilled wells (29 net). The most recent of these wells were drilled in the core of the TMS (within Australis’ acreage) in 2014. They demonstrated consistently high oil productivity and downward trending costs. Australis has commenced its own initial drilling program in the TMS and has successfully drilled and completed several wells, now on production and operated by Australis.
The depositional are of the TMS is 14 million acres across southern Louisiana and Mississippi (refer to area in blue on map below). In the early days of the TMS, operators acquired large positions speculatively on the back of then strong oil prices (pre 2015) and success in other plays. However, well performance was variable (and usually binary) depending on whether drilling occurred in or outside of the core area. The high performing wells were all drilled within the core area.
Of the approximately 80 wells that delineate the TMS Core (i.e. within the red oval of the map below which delineates the core area) ~ 50 are within the TMS Core.
Only approximately 450,000 acres (3%) is considered as part of the TMS Core.