Falcon Oil & Gas Ltd (LON:FOG, CVE:FO) is now clear to get to work with its major shale discovery in Australia’s Northern Territory after the regional government lifted its moratorium on hydraulic fracturing.
It is long awaited good news for the junior oil and gas firm, which has essentially been on hiatus while the suspension was in place.
The lifting of the moratorium followed a scientific review which recently concluded that the risk associated with the controversial well treatment could be managed.
Falcon shares started higher in Tuesday’s early deals, rising 1.4p or 5.9% to trade at 24.9p.
READ: Falcon Oil & Gas boasts strong financial position as it awaits Australia fracking decision
Immediately prior to the moratorium there was a successful test, on the Amungee well in the Beetaloo project. It was estimated that the Beetaloo basin could be host to a massive resource, across a 1,968 square kilometre area, with some 61 trillion cubic feet (TCF) of in place gas and 6.6 TCF of gross contingent resources.
Falcon is partnered with Australian gas major Origin Energy and, in today’s statement, it said that work will resume as soon as practical.
The future work will be subject to the recommendations made by the scientific review as well as the securing of necessary approvals.
Origin intends to drill and frack five new wells to complete the obligations under the exploration permit.
"We are very pleased with the fact-based decision made by the NT government to lift the moratorium on hydraulic fracturing,” said Philip O'Quigley, Falcon chief executive.
“We look forward to the recommencement as soon as practical of our multi-well work programme in the Beetaloo basin with our joint venture partner, Origin Energy Limited.”
