Reabold Resources PLC (AIM:RBD) co-chief executive Sachin Oza declared himself "delighted" as plans for the West Newton project have been approved by the UK Environment Agency.
Detailed project planning is now underway for a well in 2024.
The company, in a statement, said the Environment Agency has issued the variation of the permit for the West Newton B wellsite, which allows for the use of oil-based fluids within the Permian formations during drilling and testing operations.
It added that independent technical studies have clearly demonstrated that the use of oil-based drilling fluids will be a key factor in enhancing flow rates from wells drilled in the West Newton field.
The partners in the project are now working on plans for a proposed horizontal well from the West Newton B site, with the programme slated for the first half of 2024.
"We are delighted to receive approval from the EA for the West Newton B site,” Oza said.
“Our studies have clearly demonstrated that the use of oil-based drilling mud will be a key factor in enhancing flow rates from wells in this field, and therefore this is an important step for the drilling of the B-2 horizontal well next year.
"West Newton is potentially one of the largest hydrocarbon fields discovered onshore UK and we remain focused on developing and unlocking the significant resource potential of this asset."
West Newton was estimated in a 2022 report to host some 197.6 billion cubic feet of technically recoverable gas resources and the project was estimated to have an 86% "geological chance of success".