Falcon Oil announces spudding of Amungee development well

(Sharecast News) - Falcon Oil & Gas announced the spudding of the Amungee 2H development well on Thursday, with the Silver City Rig 40, on EP 98 in the Beetaloo sub-basin of Australia's Northern Territory.

The AIM-traded firm said the spudding took place with its joint venture partner, Tamboran B1, which is a 50-50 joint venture between Daly Waters Energy and Tamboran Resources, with the latter appointed as operator across the exploration permits.

Tamboran would drill the vertical and build section to a depth of about 2,450 metres, followed by the drilling of a 1,000-metre horizontal section within the primary target of the Amungee Member B Shale, formerly known as the Middle Velkerri B-shale.

Following drilling, the A2H well was expected to start a hydraulic fracture stimulation programme with a "US-style" unconventional shale design.

The well was designed with 5-and-a-half inch casing to allow for effective placement of proppant into the formation, optimising completion efficiency.

Falcon said A2H was the first of two horizontal wells in the third-stage programme to be drilled during the current campaign.

The precise location of the second horizontal well, also targeting the Amungee Member B shale, was currently being evaluated, with an update to be provided in due course.

"The spudding of the A2H development well is an exciting first step for the planned two horizontal wells of the stage-three work programme with our new joint venture partner, Tamboran B1," said chief executive officer Philip O'Quigley.

"This follows a successful production log test in September last year at Amungee NW-1H which suggested a normalised gas flow rate equivalent to around 5,000 million standard cubic feet per 1,000 metres of horizontal section."

O'Quigley said obtaining production rates over the first 30 days of between 2,000 and 3,000 million standard cubic feet per day on the stage-three wells would support the joint venture moving to a multi-well pilot development program in 2023-2024.

"Falcon remains fully carried for the drilling and fracture stimulation of the A2H well."

At 1309 GMT, shares in Falcon Oil & Gas were up 3.88% at 6.7p.

Reporting by Josh White for Sharecast.com.