American company Falcon Oil and Gas are hot on the heels of Beach Energy’s shale success, having successfully carried out the full testing program on the Shenandoah-1 well in the Beetaloo Basin in the Northern Territory, with gas being produced from each of the shale intervals tested.

Shenandoah-1 is a vertical well situated in the deepest part of the basin and natural gas was the expected hydrocarbon at the depths being tested. The well is the first to be tested in these unconventional targets, consequently the objectives of the tests were to determine whether the shale intervals could be fracture-stimulated and produce hydrocarbons, and to confirm rock, pressure and fluid properties.

As the operation has succeeded in these objectives, Falcon has said that the well will be plugged and abandoned.

Falcon CEO Robert Macaulay commented, “I am very pleased with the results of the Shenandoah-1 well test. We will be working through the data to understand it better before committing our plans to paper on the next steps.”

In Western Australia Woodside has released the draft environmental impact statement (EIS) for the upstream component of the Browse LNG Development for public review.

The draft upstream EIS concerns the construction, operation and de-commissioning of all the offshore aspects of the Browse LNG Development in Commonwealth waters, including offshore processing platforms and wells, and subsea pipelines and infrastructure.

Studies in the draft upstream EIS define:

• Existing ecosystems in the upstream operating area
• Potential environmental impacts due to construction and operations
• Proposed management and mitigation strategies to limit potential impacts.

Woodside will respond to submissions received during the public comment period, and these responses will be published in a supplement to the Draft Upstream EIS.

The draft upstream EIS is open for public review and comment until 25 January 2012. Copies of the draft EIS can be downloaded from the Woodside website.

In the nation’s south, Adelaide Energy directors have unanimously recommended Beach Energy’s unconditional on-market takeover offer for the company.

In the company’s Target Statement, the Adelaide Energy directors stated that, in the absence of a superior proposal, they:

• Unanimously recommend that Adelaide Energy shareholders accept Beach’s takeover offer; and,
• Intend to accept the takeover offer in respect of the shares they own or control.

Since gaining majority control of Adelaide Energy, Beach has increased its relevant interest in the company to 79.91 per cent.

In other news Australia Pacific LNG (APLNG) has signed a binding Heads of Agreement with Kansai Electric Power Company for the sale and purchase of approximately 1 MMt/a of LNG for 20 years.

Under the terms of the agreement, APLNG will supply the Japanese electric utility company with LNG from its LNG facility on Curtis Island, with deliveries anticipated to commence in mid-2016.

The agreement is conditional on APLNG making a final investment decision on the second train, which is targeted for early 2012.

Additionally, John Holland has also been awarded another marine subcontract worth in excess of $A100 million for the APLNG Project.

Under the marine subcontract, John Holland will design and construct a new product loading facility comprising a 168 m jetty and loading platform.

Included in the contract scope is the procurement, fabrication, construction and commissioning of the structural, mechanical and electrical components of the combined marine facilities.

And finally, Santos has completed its previously announced acquisition of Eastern Star Gas Limited giving the company the largest natural gas reserves position in NSW.

Santos now operates and owns 80 per cent of CSG permits formerly held by Eastern Star, increasing its total NSW reserves position to 1,216 PJ of 2P reserves and 2,238 PJ of 3P reserves. TRUenergy will own the remaining 20 per cent of the permits under a separate transaction to be completed in conjunction with the acquisition.

Santos CEO David Knox said the company is committed to ensuring that the CSG industry develops in the Gunnedah Basin without impacting the role the region plays as an important agricultural producer.