The well, spudded early Sunday morning, was at a depth of 96m by 6am local time on Monday.
Total planned depth for the well is 3783m.
The wet gas prospect is about 10 kilometres northeast of the Stanley-1gas condensate discovery held by Horizon Oil and Talisman's PNG subsidiary.
This well achieved a flow rate of up to 25 million cubic feet of gas per day on initial clean-up flowback in 2008 when Horizon Oil drilled out the cement plug set in 1999.
Back then InterOil had sold PRL 5, which contains the Stanley gas and condensate discovery, and PRL 4 to Horizon to fund more exploration in the Elk and Antelope wells in the Gulf Province.
Siphon-1 is being drilled as a deviated well targeting the northern flank of the fault-bounded Siphon prospect.
NGE has farmed in Talisman into its PPL 226 and 269 tenements in PNG, with the big Canadian oil company committing $US11 million for seismic and up to three wells over the next two years.