Falcon Oil & Gas Ltd. is pleased to announce the commencement of stimulation campaign at the Shenandoah S2-2H ST1 (“S2-2H ST1”) and Shenandoah S2-4H (“S2-4H”) wells in the Beetaloo Sub-Basin, Northern Territory, Australia with Falcon Oil & Gas Australia Limited’s (“Falcon”) joint venture partner, Tamboran (B2) Pty Limited (collectively the “Beetaloo JV partners”).
Key Highlights of the Stimulation Campaign
Stimulation campaign will be completed across:
S2-2H ST1’s horizontal section of 1,654 metres (5,427 feet) and;
S2-4H’s horizontal section of 2,977 metres (9,766 feet).
Liberty Energy (NYSE: LBRT) who mobilised equipment and sand to location before the end of last year will carry out the stimulation campaign on behalf of the Beetaloo JV partners.
Shenandoah South Pilot Project (“Pilot”)
For the next drilling phase of the Pilot, which involves the drilling and stimulation of the remaining four wells, Falcon has elected to reduce its participating interest (“PI”) from 5% to 0%.
Key Highlights of the Reduced Participating Interest
The election by Falcon to reduce its PI to 0% in the remaining four wells of the Pilot will significantly reduce it’s 2025 capital expenditure.
Falcon participated in the Shenandoah S-1H well in 2023 at its 22.5% PI which created a Drill Spacing Unit (“DSU”) of 20,480 acres.
Falcon participated in the S2-2H ST1 and the S2-4H wells in 2024 at its reduced 5% PI which created two DSU’s totalling 46,080 acres.
The Beetaloo JV partners are planning on creating an enlarged area around the Pilot, known as the First Strategic Development Area (“FSDA”), which would amalgamate the acreage and PIs from the DSUs mentioned above and any further DSUs that may be created as part of the Pilot
Depending on the ultimate size of the planned FSDA Falcon’s combined participation entitlement in the FSDA post the Pilot could be up to 10%.
Falcon also retains a 22.5% PI in the remaining 4.52 million acres in the Beetaloo, net 1 million acres to Falcon.
Philip O’Quigley, CEO of Falcon commented:
“We are extremely encouraged about the potential of the current stimulation program based on strong gas shows and other data observed whilst drilling both wells. In addition, we are very confident that the experienced US operator, Liberty Energy, will provide us with the greatest opportunity for the best possible outcome from this stimulation program. We look forward to updating the market on the IP30 flow test results as soon as they become available.
Reducing our participation in the next four wells has a minimal impact on our overall interest in the Beetaloo which remains at 22.5%. This demonstrates the optionality afforded by the DSUs, which enable Falcon to strategically and efficiently deploy its capital. This reduction in our participation in the next four wells significantly reduces our 2025 capital expenditure whilst at the same time leaving us very well positioned to capture the overall success of the Beetaloo.