At the recent RIU Essential Energy Conference, Bass Oil’s (ASX: BAS) Managing Director, Tino Guglielmo, laid out a transformative update on the company’s Kiwi project in South Australia’s Cooper Basin. What started as a promising resource has now exceeded all expectations, with condensate yields from the Kiwi-1 well blowing past initial projections, at a time when both oil prices and Australia’s gas market are hitting critical points.
Kiwi Project Delivers Tenfold Results
Bass Oil’s core production in Indonesia and the Cooper Basin has long underpinned its market capitalisation, but the latest test results from Kiwi-1 have put the company in a new league. Guglielmo revealed that condensate yields—condensate being a valuable light oil—were significantly higher than anticipated.
“We expected around 20 barrels of condensate per million cubic feet (mcf) of gas. Instead, we got 230 barrels, which is cracking,” Guglielmo said. “That’s ten times what we thought. Sometimes you’ve got to be happy to be wrong.”
Condensate is particularly valuable in today’s market. With Brent crude prices hovering between US$72 and US$92 per barrel , Bass Oil’s Kiwi discovery comes at an opportune time. The unexpected condensate yield transforms Kiwi from a promising gas play into a substantial oil producer, giving Bass Oil access to both oil and gas revenue streams in a market where energy prices remain elevated.
A Million-Barrel Opportunity
Before testing, Bass Oil had estimated the Kiwi gas resource at around 5 billion cubic feet (BCF), but the high condensate yields add new layers of value to the project. If the resource proves to be 5 BCF as expected, it could generate up to one million barrels of condensate—doubling Bass Oil’s reserves almost overnight.
“To put it into perspective, a million barrels of condensate would more than double our existing reserves,” Guglielmo explained. “From a pure valuation standpoint, this discovery could be worth more than double our current market capitalisation.”
During testing, the company was forced to limit production to 4 mcf per day due to on-site storage constraints, even though wellhead pressure indicated much greater potential. Bass Oil is now moving rapidly to connect Kiwi to infrastructure and begin production, which could unlock significant value in the coming months.
Monetising Kiwi and East Coast Gas Concerns
With such impressive results, Bass Oil is understandably keen to monetise Kiwi as quickly as possible. Fortunately, the company is well-positioned to capitalise on both the oil and gas components of the discovery. Guglielmo noted that the condensate produced from Kiwi can easily be sold to onshore refiners, adding a robust revenue stream at a time when demand for liquid fuels remains strong.
But perhaps more compelling is Kiwi’s role in the East Coast gas market. Guglielmo highlighted an emerging bottleneck in gas supply, as the pipeline from Queensland to the southern states, via Moomba, is expected to reach capacity by winter 2025.
“You’ve seen recent reports—next winter, the pipeline transporting gas from Queensland to Moomba destined for the southern states is going to be at capacity,” Guglielmo said. “That means additional spare gas capacity from Queensland won’t be able to reach southern markets. But if you have gas in Moomba, like we do, you can bypass that bottleneck.”
This puts Bass Oil in a good position to supply gas to the East Coast market, where concerns about future supply shortages are growing. In addition, according to the Australian Energy Regulator, the East Coast is expected to face gas shortfalls as early as 2027 unless more domestic supply comes online . Kiwi’s gas, with its proximity to key markets like Sydney and Adelaide, could be sold at a premium as domestic supply tightens.
What’s Next: "Son of Kiwi" and Deep Coal Prospects
While the Kiwi project is the immediate focus, Bass Oil is already looking ahead. Guglielmo revealed that Kiwi-1 is not likely to be a one-off, with plans underway for follow-up drilling, which he referred to as “Son of Kiwi” and even “Son of the Son.”
“Our priority right now is getting Kiwi connected and monetised, but we’re also preparing for the next steps which could be proving up an exciting new wet gas play,”
Guglielmo said. “Kiwi isn’t an orphan—there’s more out there, and we believe we can replicate this success.”
Additionally, Bass Oil is exploring deeper prospects in the Cooper Basin, including the potential for gas from deep coal seams. A recent geomechanical study by Schlumberger has yielded promising results, hinting that this deep coal resource could be as valuable as some of Australia’s emerging major gas resource projects such as the Beetaloo basin and the Taroom trough. While still in its early stages, the deep coal opportunity could be another revenue stream for Bass Oil in the future.
Bass Oil Positioned for a Transformative Year
For Bass Oil shareholders, the next six to twelve months could be game-changing. The unexpected success at Kiwi, combined with follow-up drilling and the deep coal opportunity, positions the company for significant growth at a time when oil prices are high and Australia’s gas market is increasingly constrained.
With production and monetisation plans advancing rapidly, Bass Oil is moving quickly to capitalise on Kiwi’s newfound potential. Investors will be eagerly watching for updates on production timelines, infrastructure connections, and further exploration results.
As Guglielmo aptly put it, "Sometimes it’s better to be lucky than good." But with Kiwi delivering tenfold results, Bass Oil appears to be both.
