The countdown has now begun for the start of Falcon Oil & Gas’s (LON:FOG) shale drilling in Australia.
Falcon, which has a 30% stake in 4.6mln acres within the Northern Territory, yesterday revealed that operations have begun at the first well location.
It is expected that the Kalala S-1 exploration well will now spud before the end of June, and the drilling will last between 35 and 50 days.
Kalala S-1 will be drilled to a depth of around 2,800 metres and it will target the Middle Velkerri formation to assess hydrocarbon saturation and reservoir quality. This will be the first of three wells in the programme.
“We are delighted to announce the commencement of drilling operations and the expected spudding of the first of our three well fully funded drilling campaign by the end of June 2015, in this highly attractive basin,” said chief executive Philip O’Quigley.
“We look forward to exploring the potential of the Beetaloo Basin in Australia with our partners and updating the market with further details in due course.”
The project is operated by Australian firm Origin Energy, which has a 35% stake, and Falcon is also partnered with South African energy major Sasol, which also has 35%.
The partners, as a result of a deal last year, are carrying the full A$63mln cost of the first five wells, which are part of a larger nine-well campaign.
Partnering with Origin and Sasol has effectively funded Falcon’s participation in the exciting exploration phase and, importantly, has underlined the attractiveness of the acreage the AIM firm secured as an early mover.