In a statement yesterday, VicPet said these hydrocarbon shows were seen in the primary target Muddy J sand and two zones in the underlying Main Dakota Formation.

Subsequent wireline analysis suggests the well has encountered 7.6m of net gas pay with fair-to-good porosity, it said.

Production testing is due to take place in the third week of July.

As a result of the encouraging drilling results, VicPet said the JV has secured the rights to acquire a working interest of up to 70% in an additional 13,000 acres (5261 hectares) adjacent to its existing 12,000 acres.

The West Florence play has been estimated to contain 100-200 billion cubic feet of recoverable gas in the Muddy J sandstone, and 5 million barrels of recoverable oil.

The project area is to the west of the Florence oil field, which produced about 15 million barrels of oil from fractured shales of the Pierre Formation in the 1940s.

Denver-based Mountain Petroleum is the project’s operator.

VicPet has a 25% interest, Fall River 15% and Adelaide Energy 10%.