Falcon shares rise as Australian judge publishes fracking report

Beetaloo could be 100 times the size of Corrib.

Fearghal O'Connor

Irish hydrocarbon explorer Falcon Oil & Gas has moved a step closer to exploiting a massive Australian gas field that it claims to have found in the Northern Territory.

The company - led by industry veteran Philip O'Quigley - has been unable to further investigate its potential find since last year, when the local government in the area put a moratorium on the controversial practice known as hydraulic fracturing, or fracking.

The Dublin-headquartered company owns a 30pc share of the huge Beetaloo Basin shale gas field, 600 miles south of Darwin. The two companies have declared a major discovery that they claim could help tackle Australia's growing energy shortages.

Last week, Justice Rachel Pepper, who is overseeing a scientific inquiry into the issues surrounding the moratorium on behalf of the Northern Territory government, published a crucial draft final report on the matter.

The report said that while risk was inherent in the onshore shale gas industry, it could be reduced to acceptable levels.

"No industry is completely without risk," said the Pepper report. "And the development of any onshore shale gas industry in the NT [Northern Territory] is no exception. But having considered the most current available scientific literature and data from a wide range of sources, and noting the recent and continuing technological improvements in the extraction of onshore shale gas, the conclusion of this Inquiry is that the challenges and risks associated with any onshore shale gas industry in the NT are manageable."

Origin, Australia's largest integrated energy company farmed in to Falcon's acreage and is paying for and operating a nine-well drilling programme at Beetaloo, the last four of which will be drilled if the moratorium is lifted. Origin has estimated a contingent resource of 6.6 trillion cubic feet of technically recoverable gas. That is up to 100 times the size of Ireland's Corrib gas field and comparable to some of the biggest shale gas fields in the world.

Over the past number of days shares in the Dublin-based explorer have risen from just above 18 pence sterling to around the 23 pence mark on Friday, having already risen four-fold over the course of the year. But the company must wait a number of months more before it finds out if the Northern Territory government is to go along with the recommendations in the report and lift the moratorium.