The Melbourne-based company said two zones intersected by the Shannon Neal-1 well in the Pennsylvanian Allegheny sandstones were perforated and tested, but only produced formation water with minor amounts of gas.

But Molopo was not deterred by the result, saying it will now focus on the primary target Devonian shale, with a view to drilling a pilot well later this year.

“The Devonian shale wells produce gas in the vicinity of Molopo’s leases,” it said.

“While these wells flow at relatively low rates, they were drilled nearly 20 years ago at a time when the shale gas extraction technology was in its infancy.”

In light of the “explosion” in new technologies, Molopo partnered with Dallas-based Republic Energy, an early participant in the sector.

“The joint venture parties will look at ways of increasing historical production rates by the application of new proven technologies, including horizontal completion,” Molopo said.