Falcon Oil & Gas Ltd. (TSX VENTURE:FO), the Toronto listed and Dublin headquartered company focused on unconventional oil and gas exploration and producing assets in Hungary, Australia and South Africa, is pleased to announce that, further to its press release issued on the 20th August, 2012, the Northern Territory Department of Mines and Energy ("DME") has granted a 12 month extension to Falcon for each of the Permits EP76, EP98 and EP117 which include the majority of the seven million acres (28,000 KM2) in the Beetaloo Basin, NT Australia, which are held 100% by Falcon Oil & Gas Australia Limited, a 73% owned subsidiary of Falcon.
Separately, the DME has also granted a 12 month extension to Falcon for adjacent EP99 which is the Permit held 100% by Falcon Oil & Gas Australia Limited, and which is excluded from the Farm-Out arrangement with Hess.
Significance of the Extensions of EP's 76, 98 and 117
- The extensions allow Hess Australia (Beetaloo) Pty Limited adequate time to complete the shooting and processing of 3,600km of 2D seismic.
- A date of no later than 30th June 2013 has now been agreed with Hess, whereby Hess must exercise its option to elect to drill, or not as the case may be, five exploration wells to earn 62.5% in EPs 76, 98 and 117.
- In the event that Hess elects to drill the five exploration wells, Falcon will be fully carried for its 37.5% of the five well exploration program.
- Falcon will also receive an additional 37.5% carry on the first development well up to a gross cost of US$10MM.
Significance of the Extension of EP99
- The Company can now move forward with its plans to shoot 150km of 2D seismic in 2013.
- Discussions with third parties on the farm-out of EP99 and the Shenandoah well area are continuing.
Philip O'Quigley, CEO of Falcon commented:
"Today's announcement now brings certainty to an election drill date by Hess of no later than the 30th June 2013. In addition, in the event that Hess decides to move to the "Development Phase", they have agreed to carry Falcon on the first development well. The extension of EP99, whilst now allowing the Company to progress its plans to shoot 150km of 2D seismic in 2013, enhances the attractiveness of a farm-in deal to third parties."
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