Attantion to back-room boys.....

Irish explorer Falcon Oil and Gas has been awarded a shale gas exploration licence in South Africa’s Karoo Basin.

The company announced its application had been approved by the Petroleum Agency of South Africa (PASA).

In December 2012, the company revealed it would be working exclusively with Chevron Business Development South Africa, for a period of five years on jointly obtaining exploration licences.

Philip O’Quigley, chief executive officer of Falcon, said:”We are encouraged by these developments and will work to meet all the requirements set by the PASA.

“The 7.5million acres in the Karoo Basin, for which Falcon is seeking an exploration licence, are geologically prospective with the Whitehill shale believed to be thick, organically rich and thermally mature.”

The licence approval comes after the South African department of Mineral Resources (DMR) told the parliament the government will soon issue companies with licences to explore for shale gas.

Director General Thibedi Ramontja commented that it is anticipated that technical regulations pertaining to hydraulic fracturing would be approved by the government at the end of January 2015, after a final round ofpublic consultation.

The PASA has requested Falcon to review and update its already drafted Environmental Management Programme where necessary.

In accordance with the South African Mineral and Petroleum Resources Development Act 2002, Falcon is required to notify and consult with communities and parties in respect of any such revisions.

Falcon has been askesd to complete this process by February 2015.

The company was granted a Technical Cooperation Permit (TCP) in 2009 covering 7.5 million (30,327 km2) acres in the southern part of the Karoo Basin.

The TCP gives Falcon an exclusive right to an Exploration Licence to find commercial hydrocarbon deposits over all or part of this area.

However the granting of the Exploration Licence was delayed to allow for appropriate regulation governing hydraulic fracturing to be put in place.

The US Energy Information Administration (EIA) has estimated that the Karoo Basin contains 390 TCF (Trillion Cubic Feet) of technically recoverable shale gas resources.

In August, the company commenced its nine-well exploration programme in the Australian Beetaloo basin following a successful sale of its shares in the asset for $20million.