Red Sky Energy provides the following update regarding the planned KN2 drilling program at the Killanoola Oil Project (PRL-13) in South Australia. 

As announced on 29 May 2025, Red Sky entered into a Farmin Agreement with Condor Energy Services and partners to fund and progress the drilling of KN2, a high-impact well targeting a new structure defined by 3D seismic. The KN2 well is designed to materially grow production at Killanoola and unlock additional potential from the licence. 

Red Sky has submitted the required Activity Notification to the South Australian Department for Energy and Mining (DEM), inclusive of site preparation and drilling operations. Final government approvals remain pending. The Company does not anticipate any significant delays in receiving final approvals. 

While slightly later than initially anticipated, the timing remains well-aligned with Red Sky’s operational planning, and the Company stands ready to commence works immediately upon receipt of final approvals. 

Red Sky welcomes the continued regulatory support for Australia’s onshore oil and gas industry, with proactive engagement from the South Australian Government enabling progress on strategically important energy developments. The Company remains confident in the approval pathway and the significant potential of the KN2 drilling program to deliver value.

Managing Director, Andrew Knox, commented: 
“While our final government approvals for KN2 are still pending, we remain fully committed to the Killanoola drilling program and are working closely with stakeholders to finalise the next steps. It’s encouraging to see continued regulatory progress supporting onshore energy activity nationally. We view this as a constructive backdrop for our own development efforts.” 

Killanoola and KN2 

The Killanoola Oil Project is located within PRL 13 in South Australia’s Penola Trough.  Red Sky’s 3D seismic program, completed in 2023, resulted in a 46% uplift in the field’s Best Estimate Petroleum Initially In Place (PIIP), increasing to 135.5 million barrels. KN2 targets a previously undrilled structural high identified from this new data.

The Company has submitted an Activity Notification to the South Australian Department for Energy and Mining (DEM) for the KN2 site preparation,  drilling, and the DW1 workover. The same rig will be mobilised for both operations, minimising cost and operational risk. 

Killanoola has a conditional offtake agreement with Viva Energy Australia Limited and is in discussions with Santos regarding alternative offtake and processing at the Port Bonython facility. 

Once its production infrastructure is in place, KN2 has the potential to increase output and drive material revenue growth significantly in the near term.

KeyFacts Energy: Red Sky Energy Australia country profile