(MENAFN - ProactiveInvestors - Australia) Armour Energy (ASX: AJQ) has been awarded a new shale exploration permit in Queensland and will launch an exploration and appraisal program to define up to 9 trillion cubic feet of potential gas resources.
Exploration will also investigate the potential for extensive oil plays.
ATP 1087 covers a 7,138 square kilometre area over thick prospective sections of the petroleum rich South Nicholson and underlying Isa Super Basins.
These basins extend to the south into ATP1107 where Armour is the Preferred Tenderer and to the west into its Northern Territory application areas.
The target Lawn Hill Shale contains a thick, organic-rich source rock section showing up to 8% gas recorded in mud logs during drilling of four petroleum exploration wells by Comalco in the early 1990s.
Together with substantial seismic data, these wells delineate an immediate Lawn Hill Shale exploration target area of about 1,400 square kilometres in the eastern portion of ATP 1087.
A gas exploration fairway of an additional 6000 square kilometres extends to the west across ATP 1087 and south into ATP1107.
Armour plans to finalise initial drill sites across the permit during early 2013 that will be located on pre-existing seismic lines.
The company is planning to drill three vertical and one lateral wells targeting the Lawn Hill Shale.
Additional gas prospectivity could be present in the Riversleigh Shale, which is a stratigraphic equivalent of the Barney Creek Shale in the McArthur Basin, Northern Territory.
Armour has also identified a new oil and gas play in the basal Jurassic sand unit that has been confirmed in regional drilling as being porous and permeable.