Drilling is expected to reach the deeper Precipice sandstone in the next three to four days, after which Icon plans to run electric logging and sidewall cores.

“If the deeper Precipice sandstone target is disappointing, Stitch-1 will be completed as a coal seam gas well within the Walloon coal seams where thick coal seams up to 10 metres have been penetrated,” Icon said.

The company’s stock was one of the top oil and gas performers on the Australian Securities Exchange in the days before the announcement was issued to the market.

Shares in the company were trading 13.6% higher between Monday and close of business Thursday, at 10c each.

Elsewhere in the ATP 626P permit, Icon said it was preparing its Lydia-1 and Natasha-1 wells for longer-term water and gas flow testing.

“Natasha-1 is bubbling gas which is an excellent early indication that gas can be recovered,” the company said.

“The gas will be collected and analysed over the next few weeks.”

Icon Energy holds a 100% interest in ATP 626P. The wells are midway between the townships of Goondiwindi and Moonie just off the Newell Highway.