Falcon Oil Share News (FOG)

(Sharecast News) - Falcon Oil & Gas updated the market on the stage three work programme in the Beetaloo Sub-Basin of Australia's Northern Territory on Wednesday, with its joint venture partner Origin Energy.

The AIM-traded firm said that, after discussions with Origin, in a bid to maximise the impact of stage three operations, the joint venture agreed to modify the programme to now include a step-out location for one well.

It said the planned work included the acquisition of a 58 kilometre line of high-spec 2D seismic data on the Amungee NW-1H well lease area, the drilling of a 1,000 metre horizontal well on the Amungee NW-1H pad, targeting the Amungee Member B Shale, and a step-out location 10 kilometres from the Amungee NW-1H pad, drilling a vertical pilot and a 1,000 metre horizontal well, also targeting the Amungee Member B shale.

The programme would also include 15-stage fracture stimulation on both horizontal wells, and extended production testing of between 90 and 180 days on each well.

As Falcon had previously announced, there would also be follow-up core and log analysis of the "very encouraging" preliminary evaluation of the 2021 Velkerri 76 well results, and further evaluation of the results of the Kyalla 117 N2-1H well to better understand the issues encountered during testing in 2021.

Falcon said the primary objective of the two wells was to obtain a production rate over the first 30 days of between two million and three million standard cubic feet of gas per day, to support a multi-well pilot programme in 2023 and 2024.

The secondary objectives for the stage three programme, meanwhile, were to achieve a drill duration of less than 45 days, characterise natural fracture network and complexity, and integrate well data with seismic data and assess the merits of future 3D seismic surveys in the Beetaloo.

"This is an extremely important period for the Beetaloo Sub-Basin, and Falcon believes the modified work programme which now includes a step out location will provide further valuable evidence and help accelerate the programme towards a multi-well pilot programme in 2023 and 2024," said chief executive officer Philip O'Quigley.

"The 2021 EPT and PLT at Amungee NW-1H provided a line of sight to achieving initial production rates in the range of three million-plus standard cubic feet per day per 1,000 metre laterals from the Amungee Member B Shale.

"Together with the large contiguous acreage position offering significant running room, the stacked prospective Amungee Member shale targets with multiple landing zones, and the proximity to the northern flank to integrate future wet gas play support a route to commerciality."

At 1148 BST, shares in Falcon Oil & Gas were down 2.61% at 11.56p.