Update from Falcon Oil & Gas Ltd.
Falcon Oil & Gas Ltd. (TSXV: FO, AIM: FOG) is excited to share notable updates regarding its operational activities, with particular focus on the ongoing stimulation campaign and key developments in the Shenandoah South Pilot Project.
Commencement of Flow Testing
Recently, Falcon Oil & Gas has noted significant advancements following announcements from Tamboran Resources Corporation. The initiation of flow testing in the Shenandoah S2-2H ST1 well marks an important milestone in the Beetaloo Sub-basin endeavor.
Details on the Flow Testing at SS-2H ST1
The flow testing at SS-2H ST1 has commenced after an extensive soaking period, enabling water absorption into the rock. This process enhances the formation's permeability to gas, setting the stage for productive outcomes in the coming months.
The Initial Production over 30 days (IP30) results are anticipated to be publicly available by mid-next month, with testing projected to continue for a full 90 days, barring any unforeseen circumstances.
Checkerboard Acreage Agreement
In line with the recent agreements, Falcon Oil & Gas and Daly Waters Energy, LP have solidified a checkerboard arrangement concerning exploration permits. Both entities will operate working interest areas, with Falcon retaining a notable non-operating interest.
Implications for Falcon Oil & Gas
This agreement positions Falcon strategically across all checkerboard segments, maintaining its critical role within the joint venture. Specifically, Falcon is noted for its 5% interest in the northern Pilot Area, which is pivotal for initial gas production.
Funding and Completion of the Shenandoah South Pilot Project
Funding progress has also been confirmed for the completion of the Shenandoah South Pilot Project. Following a successful fundraising initiative by Tamboran, plans are underway to drill and complete three additional wells at the site.
Notably, Falcon has opted to modify its stake, withdrawing its interests in these three upcoming wells, a decision reflecting the company’s strategic approach to managing expenditures while aiming for success in the region.
Valuation Insights
The recent agreements have sparked interest in asset valuations, with the transaction between DWE and Tamboran suggesting a valuation of approximately US$150 million for Falcon's acreage at a minimum price of US$150 per acre.
Investor Engagement Opportunity
To enhance investor engagement, CEO Philip O’Quigley will host a Q&A session via the Investor Meet Company platform, offering a platform for discussions related to these recent developments. Investors are encouraged to participate and submit their inquiries in advance of the event.
Looking Ahead
As Falcon Oil & Gas Ltd. continues to navigate its operational landscape, the focus will remain on extracting value from its extensive holdings, leveraging partnerships to maximize output, and strategically managing resources to secure long-term sustainability in its operations.
The company's interest remains clear, as it is positioned to support the overall success of the Beetaloo project while remaining responsive to market dynamics.
Frequently Asked Questions
What is the significance of the SS-2H ST1 flow testing?
The SS-2H ST1 flow testing is significant as it marks a critical step in evaluating gas production potential in the Beetaloo Sub-basin, which is pivotal for Falcon's operational strategy.
How will Falcon Oil & Gas be involved in future wells?
Falcon has decided to withdraw its interest in the next three wells, focusing on capital preservation while maintaining a steady interest in its remaining assets.
What opportunities exist for investors to engage with Falcon?
Investors can engage with Falcon during the Q&A session hosted by CEO Philip O’Quigley, which is designed to address inquiries about the company’s strategic direction and recent developments.
What are the expected outcomes from the Shenandoah South Pilot Project?
The project aims to deliver first gas by mid-2026, contingent on successful drilling and completion of planned wells.
How does Falcon's interest in the project compare to its partners?
Falcon maintains a unique position by having stakes across all joint venture components, signifying its integrated role in the project's success, even as it adjusts its direct operating interests.
