welcome to CEO insights I'm Marilyn De Guzman with investing News Network I'm speaking with Neil Young managing director and CEO of Elixir energy and ASX listed gas exploration and development company with projects in Mongolia and Queensland Australia I Neil hello pleased to be joining you today yes good to see you so uh let's start a conversation with just an update on uh an announcement that you did in September where you provided some updates on the progress of the gas appraisal well at your grand this gas


project in Queensland tell us a bit more about the progress on this one okay so this well is called Daydream 2 it's an appraisal well that follows up on a successful Discovery well that was drilled by be group now owned by shell uh more than a decade ago that well was called deam 1 naturally so deam 2 is less than 5 kilometers away from there we're due to Spud that well imminently and we should have an announcement out on that shortly and that will we are highly confident will intersect the same


thick gas charged column that Daydream one discovered and that will occur in around a month from the start of drilling now there's always some uh Flex in these things because when you're drilling a deep well it doesn't necessarily always go to plan or and sometimes it goes better than plan so that's the timetable for the drilling of the well it will give us a lot of data that we will then integrate into our current stimulation planning program will'll come back early in the New Year


undertake a substantial stimulation program and then ultimately flow tester will in around Q2 next year and so lots of news to come lots of activity and uh uh one that we're really looking forward to and we think our shareholders will too you know you as a gas exploration development company and there's this shifting momentum toward renewable energy and away from fossil fuels what value proposition does natural gas still hold from an investment perspective okay so the gas in this location can go to a local markets such


as Australia where there is a strong government push for more Renewables but this gas can also go through the liquefaction plants that export liquefied natural gas from Queensland that go to many countries in Asia and their decarbonization pathway can be different to the extent that gas replaces coal which it does in many of these Asian countries then that is significant decarbonization push but moving back to Australia it's absolutely evident that gas is required in the long term to underpin the renewable system


now Renewables are intermittent by their nature the the sun doesn't always Shine the wind doesn't always blow and when it doesn't you know batteries can help but for an hour two hours pump Hydra can help for eight hours but if you've got longer issues than that the only current solution is gas and so we see gas as having a very long-term uh need in Australia and in these other countries and then in addition gas provides feed stock for certain processes like making cement making fertilizers and currently


there's no real Alternatives now those things might emerge but they won't do so quickly and again we see a multi-decade horizon for those things so every credible gas uh demand Supply projection for the East Coast of Australia shows rapidly emerging Supply shortfalls even within a few years you know my my view in many people's view is that gas will in fact need to be imported by boat to Victoria and New South Wales because of the issues that their government has caused in those states that that have


led to a lack of gas supply Queensland doesn't have the same issues and uh will be called upon by the southern states to supply more gas and will be available to supply International markets as well so it's a fabulous location to be having the appraisal program that we have so um when we're talking about Australia right there's you know couple things going on so Australia's Got undergoing you know this ener energy transition going um you know working towards its goals and then there's this


uh you know and against the backdrop of this looming energy crisis that's going on as well across Australia how does your project fit within that sort of Paradigm that's going on right now so the our grandest gas project is located very advantageously it's only around 50 km from a location called the Wen biller Hub which in in gas Trading terms is a Nexus of pipelines that go in multiple directions to Brisbane to the gladston l&g plants and to the the southern markets as well it's also a


trading Hub whereby parties buy and sell gas with with increasing frequency so that location is exceptional in terms of being able to access physical and Commercial infrastructure now to build a approximately 50 kilm pipeline is in engineering terms very cheap and easy to build one for instance from the Northern Territory is not cheap or easy so this is a very advantaged location in terms of being able to supply the the the demand gas that I mentioned earlier that exists both internationally and


domestically also it's we're in a province that there's been oil and gas for like more than 60 years where local people understand it can see that it's not a threat that doesn't cause environmental issues indeed provides wealth to the community Through local investment and jobs so again it's a very advantaged location in that sense so we think all liage Stacks up very well and of course we're not the only party who thinks that the one of the world's largest private sector oil and gas


company shell has position in the same geological feature that we're in called the terum tro and indeed they're drilling right now um next door to us Santos Jo second largest Energy company has positions to our immediate north and south and they we understand will be next year and a few months ago we were pleased to announce that we'd entered into an agreement with them to share data on wealth which shows you know that this is an area of interest to people with a lot of money and expertise most


recently this week we announced a deal with origin energy who's Australia's probably third biggest Energy company under which they would contribute to ours our well costs they have a carbon capture storage project in this region and we can provide data to them from our well and so we've we've agreed for them to contribute towards that now a location where there's carbon capture and storage natural gas Renewables infrastructure is a very advantaged location and we we believe it's what


what wood McKenzie are calling an energy superbase that means it attracts Global attention and Global capital and there's no better place for a junior like us to be because our ultimate G goal is to acquire assets quickly and cheaply as we did to EXP war on a price as we are doing and ultimately to bring in partners and expertise and capital that can lead to the development in the medium term and and so we believe we're well on the track to do that right you've called natural gas the glue in


the evolving Energy System toward green energy what do you mean by this so it goes to what we were saying about the intermittent nature of Renewables and the strong limitations on other storage uh Technologies such as batteries and pumped Hydro if you try and run a modern energy Market with with only those ingredients you will face significant risks of failure um gas is flexible it can respond to know clouds and and the sun setting and and batteries failing and it can do so very rapidly uh there's already has existing


infrastructure in terms of pipelines in terms of gas fields in terms of gas storage assets SO gas Prov provides think the glue which allows Renewables to work reliably and affordably and and provide the public what they want gas itself causes some emissions but not much uh compared to other fossil fuels it's very clean burning in terms of particulates in terms of knock and socks other other pollutants from from burning fossil fuels so we see it as being required um you know for for the very


long term and ultimately the few emissions that it does cause can be offset through various mechanisms I mentioned one earlier carbon capture and storage which has got enormous potential in this region and in other regions so so we see as being a glue uh for the long term why should investors be looking at electric energy right now and what can they expect from your company in the coming months so in immediate shortterm we will have a lot of news flow about the Daydream 2 appraisal well as I said


it'll take about a month to drill we'll give frequent updates on that and then very shortly in the new year we'll follow up with a stimulation and flow test we expect positive results from that we expect upgrades to our contingent resources that could be very well be material we expect to get on a pathway to booking initial reserves we expect interest from very large companies to continue to emerge from from the interest that we've already uh demonstrated through these deals that


I've mentioned earlier uh so a lot of news flow uh also a lot of opportunity for larger forms of capital to come into this region and really underpin its development and then of course we still have our foundation gas asset uh in Mongolia we're progressing a pilot there with that country faces similar issues in terms of decarbonization and reducing pollution and we expect that project to to keep going along uh slowly but surely in the background as there's very exciting Queens in the world mat sure


through the timelines that I've described well thanks Neil for joining me and sharing your insights with me today I'm very pleased to do so and uh any interested viewers or shareholders who who want to know more we we try and put out lots of information we've got a YouTube channel we got videos on our website and you can you can ask questions of management via uh emails and such like there as well so we're always open and and happy to communicate and I'm very pleased to be talking to


you today Marilyn thank you and thanks everyone for watching join us again next time for another engaging conversation on CEO insights if you like this video make sure you subscribe to our Channel and turn on notifications so you don't miss future updates and interviews see you next [Music] time