Red Sky Energy's (ASX:ROG) share price surged after the company released a positive update on the Santos-operated (ASX:STO) drilling program at the Yarrow and Willowie fields within the Innamincka Dome in Central Australia.

Managing Director Andrew Knox said civil works for the dual-well pad at the Yarrow field — which will host the Yarrow 4 and Yarrow 5 wells within PRL 17 — are nearing completion after earthworks were delayed by consistent rainfall across the Innamincka region. The three-well drilling plan follows the commencement of site preparation works at the Yarrow gas field. PRLs, or Petroleum Retention Licences, are a South Australian permit type that allow holders to assess and develop discovered reserves.

Spud of Yarrow 4 is expected near the end of August 2026, to be followed immediately by Yarrow 5, subject to final operational scheduling, weather conditions, and access windows. The Yarrow two-well program follows Red Sky's execution of a binding authority for expenditure (AFE) with Santos.

Mr Knox also confirmed that Red Sky has been advised that access approvals have been received for the Willowie 2 appraisal well within PRL 18. Civil works at the Willowie site are estimated to commence in the second half of August 2026, with spud of Willowie 2 estimated for mid-October 2026. The Willowie appraisal well forms part of the binding AFE executed with Santos for the well.

"With civil works at Yarrow nearing completion and access approvals now in hand for Willowie 2, the program is progressing towards spud on all three wells over the coming months. We look forward to Santos advancing the campaign and building on the production performance already established at Yarrow," Mr Knox said.

The planned Yarrow development program represents the next phase of activity within the producing Yarrow field, following the tie-in and commissioning of Yarrow 1 in November 2025. Yarrow 1 and Yarrow 3 are currently producing gas and liquids into the Santos-operated gathering system.

Willowie 2 is located within the same structural trend as Yarrow and targets the Patchawarra and Tirrawarra formations — Permian-aged reservoirs that are among the primary gas-producing zones across the Cooper Basin. If successful, the well is expected to be connected to existing Santos-operated infrastructure.

Red Sky holds a 20% working interest across six PRLs (14, 17, 18, 180, 181, and 182) within the Santos-operated Innamincka Dome Joint Venture.

The Innamincka Dome is a proven producing region of the Cooper Basin, one of Australia's most established onshore oil and gas provinces, which has been in continuous production since the 1960s. Santos operates established gas-gathering, pipeline, and processing infrastructure that connects directly to the Moomba facility — a major gas processing hub and a key supply point for eastern Australian gas markets — thereby reducing well development costs and time to first production.

ROG was up by 50.0% to 0.2¢. Market capitalisation stood at $10.57 million.